Murdoch's Italian TV deal 'depends on price'

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The Independent Online
Rupert Murdoch was locked in meetings with senior executives in London last night after spending the day in Italy discussing purchase of a controlling stake in Silvio Berlusconi's three television channels.

The chairman of News Corp was "definitely a buyer" of the stations if the price was right, according to sources within the Murdoch empire. The price is expected to be at least $2bn (pounds 1.25bn) for control of three of Italy's most popular television stations.

Mr Murdoch changed his plans to make the trip following a short visit to France for talks on another possible media deal, sources said. He and Mr Berlusconi spoke for several hours and had lunch together.

The timing of the Italian visit was unsurprising. Earlier this week, efforts to reach a negotiated settlement in the impasse over Mr Berlusconi's media empire collapsed, paving the way for a referendum on June 11 that could force him to divest at least one of his channels.

Criticism of Mr Berlusconi's dominance of commercial television has grown more vociferous since he resigned as prime minister of Italy in December.

Mr Murdoch is believed to be pushing for a controlling stake in Mr Berlusconi's holding company, Fininvest, which owns a leading ad agency as well as the three commercial channels.

It is understood both sides have hired financial advisers to help settle on a price for the stake and to hammer out a possible deal between Fininvest and News Corp. Suggestions that Fininvest may be in a degree of financial trouble will be clarified in the next few days.

Executives at BSkyB, the satellite and cable broadcaster 40 per cent owned by News Corp are also understood to have travelled to Italy in recent weeks to discuss a possible deal with Mr Berlusconi.

Mr Murdoch normally becomes personally involved late in the negotiating stages of any acquisition, although it is understood that a deal has not yet been finalised.

News Corp has about $1bn in cash to spend on media acquisitions, and stands to receive up to $2bn from MCI, the US telecoms company which earlier this month agreed to buy a 13 per cent stake in News Corp.

Mr Murdoch is scheduled to spend several days in London reviewing News Corp budgets.