Satellite broadcaster EchoStar Communications yesterday formally gave up its $18bn attempt to buy Hughes Electronics from General Motors (GM), following regulatory objections. The collapse of the deal means that other media groups are free to re-enter the bidding for Hughes and its giant DirecTV broadcast subsidiary.
The sale of the US satellite TV leader to the number three player was blocked by the Federal Communications Commission in October on anti-trust grounds. "The combination of EchoStar and DirecTV would have us replace a vibrant competitive market with a regulated monopoly," said Michael Powell, the FCC's chairman.
Rupert Murdoch's News Corp, which was edged out of the race earlier this year, and John Malone's Liberty Media look certain to make fresh offers.
Within hours of the Echostar announcement Liberty executives said that they would re-bid, either on their own or jointly with News Corp.
Yet to officially respond, News Corp has spent many months trying to persuade US regulators to kill off a Echostar-DirecTV merger and has put itself in a better position to buy, by reducing its corporate debt preparing a simpler bid structure.
DirecTV recently revealed that revenues from its Latin American division have gone into reverse. That factor, combined with uncertain financial markets and the FCC's intervention, now make a lower price tag increasingly likely. But GM could still decide to keep the operation.