LONDON (Brand Republic) - News Corporation is understood to be close to finalising an agreement with General Motors which would see the media giant take control of DirecTV -- the lucrative US direct-to-home satellite service.
Under the terms of the proposal, General Motors would spin off its Hughes division, the holding company of DirecTV, which the automotive giant is keen to dispose of.
It would then be merged with News Corp’s Sky Global Networks satellite division, creating an independent publicly listed company with a value of around $70bn (£47.9bn).
News Corp is expected to take a 34% stake in the company with day-to-day operating control. The rest will be owned by investors that could include Microsoft, which is expected to invest between $4bn (£2.7bn) and $5bn (£3.4bn) in the company.
Buying DirecTV will give News Corp’s satellite division -- which already serves the UK with BSkyB and Asia with Star TV -- a stronghold in the US and Latin America, markets so far untapped by News Corp.
DirecTV is the largest direct-to-home service in the US with 9.5m subscribers.
The company would also own an 81% stake in US satellite operator PanAmSat which it could sell. PanAmSat could fetch more than $5bn (£3.4bn).