LONDON (Reuters) - The UK minister in charge of approving News Corp’s (NWSA.O) bid for BSkyB BSY.L passed on information about the process to Murdoch’s media empire through his aide, a News Corp lobbyist insisted, brushing off denials by the government.
Fred Michel said he had had no inappropriate contact with the minister, Jeremy Hunt, while he was deciding whether the $12 billion bid would impair media plurality in Britain.
But he said he believed Hunt’s views had been faithfully relayed by his aide.
Revelations last month about the extent and nature of the contacts between News Corp and Hunt’s special adviser, Adam Smith, sparked calls for Hunt to resign.
Smith resigned the following day but Hunt described as laughable the accusation that he had given News Corp special treatment, allowing an impression to pervade that Michel had exaggerated his influence.
At a press ethics inquiry called as a result of Britain’s phone-hacking scandal, Michel was asked by prosecutor Robert Jay on Thursday whether he had “puffed himself up”.
Michel answered: “No, I don’t need to puff myself up.”
Evidence submitted to the Leveson Inquiry and published on Thursday revealed that Michel and Smith had exchanged several hundred text messages, emails and phone calls during the regulatory process.
Many of the messages appeared to show News Corp and Hunt having a common goal of satisfying regulators examining the deal - although Michel claimed not to know whether Hunt was in favor of it or not.
“Think we are in a good place no?” read one text message from Michel to Smith. “Very yes. Jeremy happy,” was the reply.
Smith, 30, told the inquiry he was familiar with Hunt’s thinking on policy and co-wrote many documents with him.
“Over the time that we worked together we got to know how each other worked, I got to know what he liked and expected, he said. “He got to know how I worked and how he could use me and how I could be of assistance to him.”
News Corp, headed by Rupert Murdoch, was eventually forced to drop its bid for BSkyB last year by after an uproar over the phone-hacking scandal at Murdoch’s Sunday tabloid, the News of the World.
But until then it had looked likely that the then Murdoch-friendly Conservative government would approve the deal, which was controversial because of Murdoch’s already extensive newspaper and broadcasting assets in Britain.
Relations between the Conservatives and Murdoch have cooled markedly since Prime Minister Cameron began to distance himself in light of the scandal, with Murdoch’s newspapers going on the offensive against the government.
Michel said he assumed in general that Smith’s communications reflected Hunt’s views and said that on a number of occasions he had the impression that Smith had discussed a particular matter with Hunt before relaying his opinion.
“I believed that whatever Mr Smith told me represents the view of the Secretary of State,” he said.
Hunt took over adjudication of the BSkyB bid after Business Minister Vince Cable, a member of Liberal Democrats who are the junior party in the ruling coalition, was secretly recorded by a newspaper as saying he had “declared war” on Murdoch.
Michel said News Corp had been unable to get a meeting with Cable to put forward its arguments, but found Hunt far more receptive when responsibility for the matter was transferred to his Culture Ministry.
Reporting by Georgina Prodhan; Editing by Myra MacDonald