The satellite broadcaster BSkyB is believed to have made the controversial decision to appoint James Murdoch, the younger son of Rupert Murdoch, as chief executive.
The move would bring an end to what has proved an extremely public tussle for the top spot but risks angering institutional shareholders further and setting the stage for a stormy annual general meeting (AGM) next week.
It remains to be seen how the appointment will be sold to the City and whether the company will be prepared to make any concessions to the institutions, who say such a move would fly in the face of good corporate governance.
BSkyB's directors are holding a special board meeting at 2pm today, at which they are expected to officially choose a replacement for Tony Ball, who is standing down as chief executive.
Rupert Murdoch, BSkyB's chairman, who will join the meeting via a video link and whose News Corporation owns 35.4 per cent of the satellite broadcaster, has made no secret of his desire to have his 30-year-old son at the helm.
Institutional shareholders have, however, balked at the prospect of having a father-son combination in charge and there have been calls for Rupert Murdoch to quit if his son is made chief executive.
The nominations committee, chaired by the senior non-executive director Lord St John of Fawsley, was carrying out its final round of interviews at the weekend. It is thought that a shortlist of three, including James Murdoch and the company's finance director, Martin Stewart, has been compiled for the BSkyB board to consider. The list has been whittled down from an initial cast of about 10.
James Murdoch remains the front runner, despite the shareholder ire and fears he may be lacking in experience to take the top spot. The nominations committee is said to have been impressed by the way he has turned round Star TV, News Corp's Asian satellite broadcaster
Speculation is mounting that Rupert Murdoch might sacrifice his own position as chairman to assuage angry shareholders and keep the City on side. Others have suggested a new independent deputy chairman and a number of new non-executive directors could be appointed.
But the boardroom drama will intensify next week at the company's AGM as a powerful shareholder group, the National Association of Pension Funds, has urged investors to oust Lord St John, the former Conservative minister who is up for re-election. The NAPF argues that, after 12 years on the Sky board, Lord St John cannot be considered independent. It said it "would have expected such a fundamentally important task [as filling the chief executive job] to be led by a director whose independence was not open to question".
In its scathing report on the company, the NAPF also urged BSkyB to appoint new independent non-executive directors and recommended that shareholders also vote against the company's remuneration report at the AGM on 14 November.
ALLAN LEIGHTON, THE SKY DIRECTOR WITH REASON TO FEEL BLUE
If today's crunch BSkyB board meeting is a headache for its chairman, Rupert Murdoch, it comes in the middle of a particularly torrid time for Allan Leighton, one of the company's non-executive directors, who is going through what must be the worst week of his career.
As chairman of the Royal Mail, Mr Leighton and his team remain locked in talks with the Communication Workers Union to try to end the postal strike. While progress was said to have been made over the weekend, an agreement with the unions has yet to be struck and mail continues to pile up.
Last week, meanwhile, Leeds United - the football club where Mr Leighton is deputy chairman - turned out an annual loss of £49.5m, a record in British football. Mr Leighton, along with a mystery investor, has agreed to inject £4.4m of cash into the business in return for shares in an effort to ease the company's financial woes.
But some of Mr Leighton's misery will, no doubt, be offset by news that he would make about £1.6m if he cashed in his share options in the internet business Lastminute.com, where he is chairman.
His one million share options in the company, which specialises in last-minute travel and holiday deals, were granted at 137.5p. The stock closed at 296.5p on Friday night.
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