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News > Deals
DirecTV deal close
February 6, 2001: 7:15 p.m. ET

News Corp. reportedly ready to form new $70 billion satellite company
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NEW YORK (CNNfn) - Rupert Murdoch's News Corp. is on the verge of creating a $70 billion satellite company, merging existing assets with DirecTV, which he plans to purchase from General Motors' Hughes Electronics, according to the Financial Times.

The FT told CNN's Moneyline a surprise partner in the complex deal is likely to be Microsoft Corp. with a $4 billion-to-$5 billion involvement. The investment would give Microsoft (MSFT: Research, Estimates) access to home consumers across the globe for its set-top boxes.

News Corp. (NWS: Research, Estimates) is likely to pay $8 billion in cash to buy out GM's stake in Hughes Electronics, the paper reported. As part of the deal, Hughes would shed its Panamsat business for $6.5 billion-to-$7 billion.

graphicAfter the deal, Murdoch's Sky Global satellite company would own 35 percent of the new operation, with Hughes shareholders owning the rest.

Also involved in the deal as a "significant investor" would be Liberty Media  chairman John Malone, the paper said.

The boards have yet to approve the deal, the FT said.

A spokesman for Hughes (GMH: Research, Estimates) and GM (GM: Research, Estimates) said the companies will decline to comment on rumor and speculation until there is an actual deal. A News Corp. spokesman was not immediately available for comment.

In December, it was reported that AOL Time Warner, the parent of CNNfn.com, was interested in DirecTV.

Shares of Hughes finished $1.41 higher Tuesday, at $27.71, while American depositary receipts (ADRs) of News Corp. rose 20 cents to $37.50. graphic





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Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer. Morningstar: © 2018 Morningstar, Inc. All Rights Reserved. Factset: FactSet Research Systems Inc. 2018. All rights reserved. Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor's and S&P are registered trademarks of Standard & Poor's Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2018 and/or its affiliates.