Bloomberg News

News Corp. Lobbyist Used Threat Over BSkyB Deal, Lawmaker Says

June 26, 2012

News Corp. (NWSA:US)’s top lobbyist in Europe threatened a U.K. politician with negative newspaper coverage of his party if the company’s British Sky Broadcasting Group Plc (BSY) takeover bid was blocked, the lawmaker told a media inquiry.

Fred Michel, who handled News Corp.’s policy and public affairs in Europe, implied the Sun tabloid would write negative stories about Liberal Democrats if Business Secretary Vince Cable, who belongs to the party, didn’t approve the 7.8 billion- pound ($12.2 billion) deal, Member of Parliament Norman Lamb said in a statement to the inquiry in London.

Michel “specifically mentioned the Sun and indicated that it had given the Liberal Democrats reasonable coverage since the general election” in May 2010, Lamb said. “He then implied that if the decision surrounding the bid did not fall in their favor, it would be a pity if things were to change and they were no longer able to report in such a positive way.”

New York-based News Corp. said today it’s considering splitting into two publicly held companies to divide its publishing units from its entertainment holdings. The move comes nearly a year after the phone-hacking scandal at News Corp.’s News of the World tabloid scuttled the BSkyB bid and prompted Chairman Rupert Murdoch to shutter the 168-year-old title.

Lamb was an adviser at the time to Deputy Prime Minister Nick Clegg, a Liberal Democrat and the junior member of the coalition led by Prime Minister David Cameron, a Conservative. Cameron called for the inquiry in response to public anger over the hacking scandal.

Miranda Higham, a spokeswoman for News Corp. in London, declined to comment on the lawmaker’s statement.

Before Cable could make a decision on the BSkyB bid, Cameron stripped him of responsibility for reviewing the deal after undercover journalists recorded him saying he had “declared war” on Murdoch.

The decision was given to Culture Secretary Jeremy Hunt, a Conservative who later faced calls to step down after evidence at the inquiry revealed improper communications about BSkyB between his office and Michel. Hunt’s top aide resigned.

To contact the reporter on this story: Erik Larson in London at elarson4@bloomberg.net

To contact the editor responsible for this story: Anthony Aarons at aaarons@bloomberg.net


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