A powerhouse film broadcaster is set to emerge in Japan following the merger of Star Channel, Japan's largest all-movie cable and satellite service, and Sony and News Corp's Sky Movies.

The merged company will retain the name Star Channel and source films from six Hollywood majors. The service will have a library of nearly 1,000 titles.

Star Channel owners Itochu and Tohokushinsha, which each own a 35.3% share, are to sell half their stock to Sony and News Corp, Sky Movies' leading shareholders. Each of the four companies will have a 17.65% stake in the entity.

Star Channel was broadcasting to 183,000 cable and 238,000 satellite subscribers at the end of October. It has output deals with Warner, UA, Paramount and Universal. Sky Movies has been operating on the Sky Perfectv communications satellite since 1998 and sources films from Fox and Sony Pictures.