Odey snaps up BSkyB shares as price falls

Odey Asset Management yesterday said it bought more than three million shares in BSkyB last week, even as other hedge funds took heavy losses on the firm.

Odey chief executive David Stewart said the scandal surrounding the News of the World had not changed its views on the satellite broadcaster, which is the subject of a protracted takeover bid by Rupert Murdoch's News Corporation.

Shares in BSkyB had gained steadily on the offer price of 700p a share in recent months in the expectation that News Corp would have to raise its bid, but fell back last week as the phone hacking scandal at the News of the World looked like jeopardising the deal.

Hedge funds were left nursing losses as the firm shed about 1.8 billion of its stock market value.

But Odey increased its holding in BSkyB to around 2.5 per cent, which Stewart said is "our highest level, probably ever".

He added: "At 750p or 775p a share, it's a screaming buy. We're happy to be shareholders in the company. It's not a news company, it's a technology company - a platform content and software firm. If a major shareholder gets into difficulty, then we should be buyers from them."

Stewart said Odey had not met with Rupert Murdoch and had no interest in doing so.

As calls mounted yesterday for Culture Secretary Jeremy Hunt to postpone his decision on whether to allow Murdoch to take full control of BSkyB, it was reported that the bidder would face a 38.5 million bill if the deal failed to go ahead.

The fee would cover regulatory and other costs associated with the buyout attempt, and would be triggered if News Corp does not go ahead with its plans.

The cash was said to be part of a deal agreed by Murdoch's son James, chairman and chief executive of news international and also chairman of BSkyB, when he launched the bid to buy the 61 per cent of shares News Corp does not already own.

Based on increased profits at the broadcaster, it is thought the price the Murdochs would have to pay for BSkyB to satisfy investors - should they eventually be allowed to do so - could be closer to 1,000p a share.