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The station is set to be a rolling news service, bringing up-to-the-minute news and analysis from the UK and around the world using content from the Sky News team and the news team from Chrysalis Radio's LBC network.

Chrysalis Radio's existing London rolling AM news station, LBC News 1152 will be incorporated into the joint venture, and will be rebranded as 'Sky News Radio for London'.

The station will become a regional sister station to the national Sky News Radio service, with relevant local news, traffic and travel, weather and sport for London retained as part of its output.

Sky News Radio will be made available via the internet and Sky's digital satellite platform in the near future.

Phil Riley, chief executive, Chrysalis Radio, said: "This is a really exciting development for us. We are thrilled to be working with Sky, and think that the combination of our radio experience, their news expertise and the power of the Sky News brand, will make Sky News Radio a compelling proposition."

John Ryley, head of Sky News, added: "This partnership will build on Sky News' strength in rolling news, extend the reach of the Sky News brand and increase choice in news radio in the UK."

Chrysalis Radio is part of a consortium bidding for the second national digital multiplex shepherded by Channel 4. The bid also includes partners Emap Radio, UTV Radio, BSkyB, the Carphone Warehouse Group and UBC Media.

As well as launching radio stations on the platform, 4 Digital Group will be heavily involved with digital media, introducing a range of on-demand podcasts from the a diverse range of media properties as Gaydar radio, Club Asia, the NME, Penguin and the Financial Times.

The consortium plans to introduce: youth brand E4 Radio; Channel 4 Radio, a speech-based station; Pure4, a music-based station; Talk Radio from UTV; Closer, a music based formula based around the magazine format of the same name; Sky News Radio; Asian station, Sunrise; Virgin Radio Viva; Original, an album orientated music brand and; children's station Radio Disney.

The group will face a challenge from National Grid Wireless, a wholly owned subsidiary of National Grid, one of the world's premier utilities companies.

National Grid Wireless proposed stations include music-based 4 Radio 1 and 4 Radio 2, Radio Luxembourg and the BBC Asian Network.