News Corp’s £7.8-Billion Buyout Proposal For BSkyB Gets Rebuffed

News Corp NWS today offered 700 pence a share, or £7.8 billion ($11.5 billion), in cash to acquire the remaining 61% stake it doesn’t hold in British Sky Broadcasting Group PLC (BSY), the largest pay television provider in the UK. NWS currently holds 39.1% stake in BSY. However, British Sky, in consultation with Morgan Stanley and UBS, replied that the offer considerably undervalues the company. British Sky demanded an additional £1 billion and stressed that it will support an offer that exceeds 800 pence a share. News Corp’s deputy chairman, president and chief operating officer Chase Carey said, "We believe that this is the right time for BSkyB to become a wholly-owned part of News Corp with its greater scale and broader geographic reach.” According to him, the proposal gives NWS an "opportunity to consolidate a core business with which we have been closely associated for over two decades". The media giant will also benefit from "increasing the geographic diversification of our earnings base, reducing our exposure to cyclical advertising revenues and increasing our direct consumer subscription revenues," Chase Carey added. Shares of NWS slipped 0.9% yesterday, but gained 0.06% in the pre-market session. Read more from Benzinga's Company news.