Murdoch ducks questions as Malone speaks out on stake

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John Malone, the chairman of Liberty Media, which has almost doubled its voting stake in News Corp, yesterday described the poison pill Rupert Murdoch's group has adopted in response to his group's stake building as "friendly".

John Malone, the chairman of Liberty Media, which has almost doubled its voting stake in News Corp, yesterday described the poison pill Rupert Murdoch's group has adopted in response to his group's stake building as "friendly".

Speaking for the first time about Liberty's intentions towards News Corp since Liberty took its stake from 9.2 per cent to 17 per cent, Mr Malone decided to go on a diplomacy drive. He pointed out that the media giant controlled by Mr Murdoch allowed Liberty's purchase of shares to go through without triggering the poison pill of a deeply discounted nine for one rights issue.

"It was a friendly pill. I wasn't surprised or shocked. I understood their board's decision," Mr Malone, who has built a reputation as one of America's most aggressive empire builders, said.

He added that Liberty had not been able to alert Mr Murdoch to its plan to buy $1.5bn of News Corp voting stock last week because it might have violated US securities laws. "Unfortunately, that caught them by surprise, and they did the prudent thing," Mr Malone said.

He added that Liberty's intentions towards News Corp were "entirely friendly", and said he had "enormous admiration" for Mr Murdoch.

The decision to increase its holding of New Corp's voting stock was "opportunistic and strategic". "We were a very large equity holder in News Corp and thought it was prudent to have a larger voting interest," Mr Malone said.

While Mr Malone spoke publicly about his group's latest move on a conference call, Mr Murdoch, the chairman of News Corp, ducked questions in London from the press at the annual meeting of BSkyB, the British satellite television company he also chairs. News Corp has a 35 per cent stake in Sky.

Uncharacteristically, Mr Murdoch did not take questions from the media after the event.

Releasing its quarterly results, Sky predicted that it would add more than 100,000 extra subscribers this Christmas, as its massive marketing campaign begins to pay off. A new marketing blitz kicked off at the beginning of October. Shares in Sky closed up 4 per cent at 554p.

The satellite television group reported that its autumn season - the first quarter of its financial year - had seen the addition of 62,000 new customers. While this was well ahead of City expectations of 50,000 more subscribers, analysts pointed out that original expectations had been for more than 100,000 for the period, but Sky guided forecasts down after its profits warning in August.

Nearly one-fifth of Sky shareholder votes cast were against the terms of its controversial buy-back programme.

The disgruntled investors did not vote against the actual buy-back resolution put to the meeting but against an accompanying resolution, which was to grant News Corp an exception from having to take part in the buy-back.

As News Corp owns more than 30 per cent of Sky, any further increase in its stake - for instance by not selling shares into a buy-back - would otherwise trigger an automatic bid for the whole company under the Takeover Code. News Corp had sought an exception from this rule of the code, so the buy-back will see its Sky stake rise from 35 to 37 per cent.

One shareholder at the AGM said the exemption served the interests of the "Murdoch corporation" but the contentious resolution got 688 million votes in favour, with 153 million against. A further 11 million votes were abstentions.

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