British Sky Broadcasting (BSkyB) has rejected a bid from Rupert Murdoch's News Corporation to take full control of the satellite broadcaster.
News Corporation, which also owns The Times, The Sun and News of the World newspapers, has made an offer worth 700p a share, valuing BSkyB at around £12bn. The company currently owns 39.1 per cent of BSkyB.
BSkyB has rebuffed this offer saying it was too low. However, talks between the two parties are continuing, with the aim of sealing a deal worth at least "in excess of 800p" a share.
News of the bid has pushed shares in BSkyB up by 21 per cent.
Earlier this month, BSkyB aquired the Virgin Media Television unit for £160m, giving Sky ownership of the channels Living, Livingit, Challenge, Challenge Jackpot, Bravo, Bravo 2 and Virgin1.
The company's marketing spend is on course to hit £1bn this year as the pay-TV company looks to build on a 76 per cent bump in take up of its high definition television service.
The pay-TV company reported pre-tax profit increased to £707m in the last three quarters, up from £339m in the same period a year earlier, with its subscriber base nearing 10 million.
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