Murdoch under pressure to pay more for Sky

BSkyB put pressure on Rupert Murdoch to raise his takeover bid for the broadcaster yesterday by posting a strong set of annual results as its high-definition services continued to attract customers.

Mr Murdoch's News Corporation, which owns close to 40 per cent of Sky, last month expressed its intention to launch a full bid valuing the company at £12.9bn, and is currently undergoing regulatory clearance for an offer.

Sky's chief executive Jeremy Darroch, said yesterday it was "business as usual" as News International had yet to table an official bid. "The management team are entirely focused on what is going to be a great year for Sky."

Analysts and shareholders, however, have been calling for the group's largest shareholder to increase its 700p per share bid significantly. The independent board members evaluating the deal called for an offer closer to 800p. Paul Richards, at Numis Securities, said: "The strength of the results underpin the stance of the independent directors that they want 800p. Anything above that would be a victory." Analysts at Nomura have said the bid should be more like £10 a share.

Sky's chief financial officer Andrew Griffith said the "time for the real debate over price will be if and when News Corporation come back with a bid. Then it will be up to the shareholders to decide". Shares in Sky yesterday closed down 8.5p at 713p.

Sky reported an 11 per cent increase in revenues last year to £5.9bn, with operating profits up a tenth to £855m. The group also lifted its dividend 10 per cent to 19.4p, double that of five years ago.

The growth in revenues was once more driven by customers flocking to the high-definition package, which offers viewers better picture and sound quality for an additional cost. In its fourth quarter, 429,000 customers switched to HD services, bringing it to 30 per cent of Sky subscribers. It now offers 43 HD channels.

Mr Darroch said: "High definition goes from strength to strength, with more than twice as many customers as a year ago." The company believes the trend will continue as households replace their standard TVs with HD-ready sets.

The group gained 90,000 new customers in the three months to the end of its financial year, bringing its total number of customers to 9.8 million.

Sky is also launching a dedicated 3D channel to homes in October. It began showing Premier League football matches in 3D in pubs earlier this year.

Media companies have been increasingly looking to tie in customers to several services. Sky said that one in five of its customers now take a bundle of its TV, broadband and fixed line telephone services. Its broadband operations continued to grow as it added 119,000 customers in the fourth quarter as it, along with the telephony business, moved into profitability for the first time

The group said yesterday: "This performance reflected a number of initiatives over the last 18 months, including an improved take-up of bundled products and a continued focus on cost efficiency."

Thomas Singlehurst, an analyst at Citi, said: "These are good results and the focus on delivery is to be applauded; there is no doubt in our mind that Sky is increasingly becoming a 'jam today' story."

Showtime: Sky signs HBO deal

Sky has signed an exclusive deal to screen new content from HBO, whose critically acclaimed shows include The Sopranos and The Wire, to bring in new customers in the UK.

The deal will give Sky the rights to show series including Martin Scorsese's highly anticipated Boardwalk Empire and Luck, starring Dustin Hoffman and written by David Milch, responsible for HBO's epic Western series Deadwood. The coming series of established HBO shows, such as Entourage and Big Love, will also be available only on Sky.

Sky said the move was part of its "commitment to invest in standout content that differentiates the pay-TV experience and creates more reasons for customers to subscribe". The contract spans five years, but Sky would not confirm the size of the deal. One source said the deal was worth "double digit millions of pounds a year".

Tim Westcott, senior TV analyst at Screen Digest, said: "HBO has a great track record. The hallmark of what it's done is to pick creative people and give them artistic freedom. It also spends a lot of money." He said its content, which also includes Sex and the City, Six Feet Under and Band of Brothers, has been popular in the UK

"The upcoming shows will give Sky kudos with viewers," Mr Westcott said. "It has previously invested in content but it has not been easy to build up a profile in drama." In the past Sky has brought in US content including Lost and House, although they had previously been on terrestrial TV.

Mr Westcott said: "This is part of Sky's overall strategy to reinforce its content. It is partly a reflection that after making its name in sport, it has to show other strings to its bow." He added that it could help encourage some who had previously resisted subscribing to Sky, although he added it was "about keeping existing customers happy".

HBO, which traces its roots to 1965, initially screened pay-per-view boxing and old movies in the US, before making its name in drama with Oz in 1997 and The Sopranos two years later.

Sky is also preparing to launch a video on demand service called Anytime+ which will offer subscribers access to HBO's classic shows.

Separately, Sky announced a slate of original comedy shows for its Sky1 channel. These include Stella, developed by Ruth Jones, who starred in BBC hit Gavin & Stacey. There will also be a season of autobiographical shows from comics including Dawn French, Kathy Burke and Stephen Fry.

Start your day with The Independent, sign up for daily news emails
Arts and Entertainment
filmPoldark production team claims innocence of viewers' ab frenzy
Life and Style
Google marks the 81st anniversary of the Loch Ness Monster's most famous photograph
techIt's the 81st anniversary of THAT iconic photograph
Katie Hopkins makes a living out of courting controversy
All the major parties are under pressure from sceptical voters to spell out their tax and spending plans
ebooksA special investigation by Andy McSmith
Arts and Entertainment
Kevin Spacey and artistic director Matthew Warchus at the Old Vic party to honour Spacey
theatreStar's successor at Old Vic theatre admits he's 'allergic to hype'
Life and Style
life + healthVirginia Ironside's dilemma, during Depression Awareness Week
Arts and Entertainment
The median income for professional writers is just £10,432, less than the minimum wage
booksSurvey reveals authors' earnings
Life and Style
  • Get to the point
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Guru Careers: Pricing Analyst

£30 - 35k (DOE): Guru Careers: We are seeking a Pricing Analyst with experienc...

Ashdown Group: Treasury Assistant - Accounts Assistant - London, Old Street

£24000 - £26000 per annum + benefits : Ashdown Group: A highly successful, glo...

Ashdown Group: Sales Team Leader - Wakefield, West Yorkshire

£21000 - £24000 per annum: Ashdown Group: The Ashdown Group has been engaged b...

Ashdown Group: Head of Client Services - City of London, Old Street

£45000 - £50000 per annum + benefits : Ashdown Group: A highly successful, int...

Day In a Page

Revealed: Why Mohammed Emwazi chose the 'safe option' of fighting for Isis, rather than following his friends to al-Shabaab in Somalia

Why Mohammed Emwazi chose Isis

His friends were betrayed and killed by al-Shabaab
'The solution can never be to impassively watch on while desperate people drown'
An open letter to David Cameron: Building fortress Europe has had deadly results

Open letter to David Cameron

Building the walls of fortress Europe has had deadly results
Tory candidates' tweets not as 'spontaneous' as they seem - you don't say!

You don't say!

Tory candidates' election tweets not as 'spontaneous' as they appear
Mubi: Netflix for people who want to stop just watching trash

So what is Mubi?

Netflix for people who want to stop just watching trash all the time
The impossible job: how to follow Kevin Spacey?

The hardest job in theatre?

How to follow Kevin Spacey
Armenian genocide: To continue to deny the truth of this mass human cruelty is close to a criminal lie

Armenian genocide and the 'good Turks'

To continue to deny the truth of this mass human cruelty is close to a criminal lie
Lou Reed: The truth about the singer's upbringing beyond the biographers' and memoirists' myths

'Lou needed care, but what he got was ECT'

The truth about the singer's upbringing beyond
Migrant boat disaster: This human tragedy has been brewing for four years and EU states can't say they were not warned

This human tragedy has been brewing for years

EU states can't say they were not warned
Women's sportswear: From tackling a marathon to a jog in the park, the right kit can help

Women's sportswear

From tackling a marathon to a jog in the park, the right kit can help
Hillary Clinton's outfits will be as important as her policies in her presidential bid

Clinton's clothes

Like it or not, her outfits will be as important as her policies
NHS struggling to monitor the safety and efficacy of its services outsourced to private providers

Who's monitoring the outsourced NHS services?

A report finds that private firms are not being properly assessed for their quality of care
Zac Goldsmith: 'I'll trigger a by-election over Heathrow'

Zac Goldsmith: 'I'll trigger a by-election over Heathrow'

The Tory MP said he did not want to stand again unless his party's manifesto ruled out a third runway. But he's doing so. Watch this space
How do Greek voters feel about Syriza's backtracking on its anti-austerity pledge?

How do Greeks feel about Syriza?

Five voters from different backgrounds tell us what they expect from Syriza's charismatic leader Alexis Tsipras
From Iraq to Libya and Syria: The wars that come back to haunt us

The wars that come back to haunt us

David Cameron should not escape blame for his role in conflicts that are still raging, argues Patrick Cockburn
Sam Baker and Lauren Laverne: Too busy to surf? Head to The Pool

Too busy to surf? Head to The Pool

A new website is trying to declutter the internet to help busy women. Holly Williams meets the founders