U.K. Minister: News Corp. Bid for BSkyB Was 'Political Inconvenience'

George Osborne - P 2012
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Finance Minister George Osborne says that a regulatory decision one way or another would have caused a political headache for his political party.


LONDON -- Finance and Treasury Secretary George Osborne on Monday described the bid by Rupert Murdoch's News Corp. for a controlling stake in U.K. satcaster BSkyB as a "political inconvenience."

Osborne, giving evidence to the Leveson Inquiry into media ethics, said he "didn't have a strong view about its merits" because he "felt it was going to cause us [Conservative party members] trouble one way or the other."

The Leveson Inquiry, which has probed the U.K. media's relationship with politics and the public, has looked into whether Murdoch's company promised support for David Cameron's conservative party during the 2010 elections in exchange for regulatory support of the deal.

News Corp.'s $12 billion bid to acquire full control of pay -TV operator BSkyB was later scrapped amid the phone hacking scandal that engulfed News Corp.'s publishing division News International.

The chancellor of the exchequer was quizzed at length on Monday afternoon over his role and contacts with Murdoch while the regulatory review of the bid went on.

Osborne said he felt News Corp.'s $12 billion bid was a "political inconvenience" because, whatever happened, it would lose the Conservative party favor with some media groups.

"I think that judgment has been borne out by events," he added.

Osborne also told the Leveson enquiry that there was "no substantive discussion" with U.K. Culture Secretary Jeremy Hunt or the then British business secretary Vince Cable about the bid.

Hunt had defended his interactions with reps of News Corp. during the regulatory review process of the conglomerate's BSkyB bid at the end of May this year.

Hunt took over responsibility for the review of the BSkyB bid, which was scrapped amid the phone hacking scandal, after Cable had told under-cover reporters that he had declared war on Murdoch - a comment seen as causing him to be biased in the review.

Cable previously told Leveson in his own testimony that his controversial war remark was simply meant to show he wouldn't be intimidated in his regulatory review.

For his part Osborne told Leveson he was "not aware" of Hunt's view of the bid, or of the British Prime Minister David Cameron's stance.

"I assumed, speaking about Mr Cameron, that the whole thing was a political inconvenience," Osborne said.

Osborne added that several newspaper groups and, "rather extraordinarily", the director general of the BBC opposed the bid. Cameron is due to give his evidence to the enquiry on Thursday this week.