MS may invest $1 b. in Murdoch unit

Microsoft is reportedly negotiating a $1 billion investment in media mogul

Rupert Murdoch’s NewsCorp conglomerate. The investment by Microsoft reportedly

involves NewsCorp’s Sky Global unit, which is in the process of preparing for

an initial stock sale this quarter.

Apparently, the Microsoft deal is mostly motivated by the potential gains on

investment rather than a strategic purpose. Investors believe the company’s

large financial commitment would boost the likelihood of a successful IPO.

Because Microsoft will receive the Sky Global stock at a vastly reduced cost,

the company is likely to reap in a handsome profit on its investment.

NewsCorp is eager to have the Sky Global IPO succeed as the deal could raise

$5 billion for the company. Sky Global include News Corp's satellite-TV services

in Asia and Latin America, as well as its stakes in British Sky Broadcasting and

Gemstar-TV Guide International.