Wednesday, September 9, 1998 Published at 21:12 GMT 22:12 UK
United accepts £623m BSkyB bid
The famous ground of Old Trafford could soon be within the BSkyB business empire
Click here for News Online's special report on Murdoch meets United
Manchester United has officially confirmed to the London Stock Exchange that it has accepted a £623.4m bid from Rupert Murdoch's television company, BSkyB.
It is the largest amount ever offered for a sports club.
However BSkyB and Manchester United defended the deal, denying that they would betray the club's fans and hailing the deal as one of the 'great partnerships in sport'.
News of the higher offer caused Manchester United's shares to leap upwards again on the London stock market.
The club's shares rose more than 10% to 221p in early trading, and have now soared almost 40% since BSkyB first confirmed its interest in the club on Monday.
Manchester United share holders will receive 120p in cash and the rest in BSkyB shares. and the offer represents a 51% premium to the club's closing share price of 159p on Friday.
However David Brooks, an analyst at Japanese bank Nomura, believes that this is just Rupert Murdoch's opening gambit, and the final takeover price could be as high as 275p.
BSkyB's bid still has to be approved by shareholders and the Office of Fair Trading, which will have to assess whether or not it is in the public interest.
Its popularity has meant that it earns as much from merchandise sales and advertising as from gate receipts.
Officials from Manchester United have been locked in talks at a London business suite over the last few days discussing Rupert Murdoch's offer, amid growing opposition from fans.
Murdoch involved in talks
The paper says BSkyB was forced to increase its bid after two Manchester United directors reckoned the club was being under-valued.
The figure represents about £30m more than if he had sold his shares on the open market on Friday.
Another winner will be non-executive director Maurice Watkins who, according to the club's last company report, owned around 2% of the club.
The stake would be valued by BSkyB under the deal at just over £12.5 million, up from just over £8 million on Friday.
Opposition to sale
FA chief executive Graham Kelly said United had to explain the deal to its fans, adding: "We have to assess the implications very closely indeed."
Key deal for Rupert Murdoch
It sprang from a lunch with United chief executive Martin Edwards, who himself stands to make £87m from his 14% stake in the club.
BskyB, Britain's most profitable broadcaster, has invested heavily in sports programming.
It paid £670m for the right to broadcast live football matches in 1996.
But those rights run out in 2001 - and by then some of the big clubs may want to sell their rights individually.
Looming over the deal is the question of pay-per-view television.
By some estimates the bigger clubs like Manchester United could share a bonanza of up to £2bn if fans had to pay a fee to watch each match rather than a fixed fee to BSkyB.
The deal would also secure BSkyB's position if a European Super League were to go ahead, combining the best clubs in Europe.
Manchester United would be certain to be included in such an arrangement.