Murdoch loses out in bid to acquire Newsday

The new owners of Newsday, the New York suburban daily, will be Cablevision, a large cable, television and sports conglomerate.

The announcement came after a weekend of confusing reports, which included an announcement that Murdoch’s News Corp was pulling out of the bidding. This was after Cablevision had upped their bid to $650 million – 70 million more than the Murdoch offer

There was one other bid – from Murdoch’s big New York rival, Mort Zuckerman, owner of the NY Daily News. His bid was the same as Murdoch’s Cablevision, which provides cable service to about three million subscribers in the New York area, andhas said it will expand the newspaper operation. The company also owns several theatres and sports centres in the New York area, including Madison Square Garden. It also owns several sports teams.

Originally News Corp thought it had a handshake agreement with The Tribune company which owns Newsday and several other major US newspapers but has been having financial problems lately.

What appears to have swung the deal is an agreement that the Tribune will retain a three per cent stake in the joint venture – which will reduce the taxes that could be payable. The additional money also helped.

Many staff at Newsday had hoped the paper would be bought by a regular newspaper owner – such as Murdoch. The chairman of Cablevision, Charles Dolan, however assured them: “We are committed to maintaining Newsday’s journalistic integrity and important position in the marketplace”.

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