BSkyB hits a high as takeover talk gains momentum

BSkyB shares today hit a fresh nine-year high of 843p as traders expect News Corp to get the green light for its takeover next week and begin final negotiations on price with shareholders.

Culture Secretary Jeremy Hunt is set to give his approval on or just after April 26, paving the way for Rupert Murdoch's News Corp and independent shareholders to thrash out an agreed offer.

News Corp, which already owns 39% of BSkyB, made an initial approach at 700p last June but has not tabled a formal offer as it is awaiting regulatory approval. The non-executive directors, led by deputy chairman Nicholas Ferguson, demanded "at least 800p" at the time. Since then BSkyB's profits and the FTSE100 have both risen sharply.

At today's price, BSkyB, which has the rights to premiership football as well as Sky Atlantic dramas such as Mad Men and Game of Thrones, is worth £14.7 billion. That means News Corp would have to pay £9 billion for the 61% it does not already own. Even if Hunt gives the green light as early as next Tuesday, analysts expect negotiations over the price to wait until after Sky's third-quarter results on April 28.

But one leading shareholder said: "It has gone very, very quiet in the last few weeks. We want to see Sky's results. Let's see the hands of cards, then we'll sit down and talk."

One City analyst said: "Because a lot of people are away, it may be a couple of weeks, after the royal wedding."

One top shareholder - Odey Asset Management, whose boss Crispin Odey is Rupert Murdoch's former son in law - called for 950p a share last month and some even talked about as much as 1100p. However, UK consumer confidence has taken a knock since then.

Hunt plans to approve the News Corp takeover on the condition that Sky News is hived off as a separate company on the stock market to protect its editorial independence.

After hitting 843p this morning, the shares settled at 837.5p, up 1p.