Britain will give News Corp a final chance to avoid a prolonged investigation into its buyout of BSkyB in a move likely to draw flak for the government's relations with Rupert Murdoch.
Culture Secretary Jeremy Hunt said today he would consider unspecified proposals put forward by News Corp to alleviate competition concerns before deciding whether to refer the proposed deal for a full, six-month competition inquiry.
"On the evidence available, I consider that it may be the case that the merger may operate against the public interest in media plurality," Mr Hunt said in a statement.
If the BSkyB deal is referred to the Competition Commission, it would look at the merger on the grounds of media plurality and whether it would reduce the number of "voices" in the sector.
Mr Murdoch is seeking to buy the 61 per cent of BSkyB it does not already own, aiming to consolidate a business it helped build but raising concerns it would give the company led by Rupert Murdoch too much control over media and public opinion.
The move also comes at a time when Mr Murdoch's empire is under fire in Britain for the conduct of its journalists in a phone-hacking scandal that has thrown a light on the power and integrity of his company.
News Corp said it strongly disagreed with the conclusion drawn by media regulator Ofcom that a referral was needed, but said for the sake of expediency it would work with the government to find a solution. It did not say what its proposals were.
Some lawyers have speculated that News Corp could offer to spin off its news channel Sky News, but several media bankers have told Reuters they do not know of any obvious buyer for the channel, making that option more complicated.
News Corp owns about a third of the newspaper market in Britain, including the Times and the country's best-selling tabloid the Sun, which both supported Prime Minister David Cameron during last May's general election.
Reuters