News Corp and Permira to Acquire NDS Group

News Corporation and two newly incorporated companies formed by funds advised by Permira Advisers LLP (the “Permira Newcos”) has announced that they have proposed a transaction to an independent committee of the board of directors of News Corporation’s majority-owned public subsidiary, NDS Group plc, which would result in NDS ceasing to be a public company, and Permira Newcos and News Corporation owning 51% and 49% of vote and value in NDS, respectively.

If the proposed transaction proceeds, News Corporation and Permira intend to implement the transaction by way of a scheme of arrangement (“Scheme”) under Part 26 of the Companies Act 2006 (U.K.). Consummation of the Scheme will be subject to court approval, the approval of Series A shareholders representing a majority in number and 75% in value, the availability of financing and other customary conditions, including the receipt of required antitrust approvals. The transaction as proposed would be funded by a mix of newly incurred NDS senior and mezzanine indebtedness, an investment provided by the Permira Newcos and cash on hand at the NDS group. In the event that the proposed transaction proceeds, News Corporation and Permira anticipate that the Scheme would become effective in the fourth quarter of 2008.

As a result of NDS’s listing on NASDAQ, the transaction would be subject to review by the Securities and Exchange Commission. The UK Panel on Takeovers and Mergers has confirmed that the City Code on Takeovers and Mergers (the “City Code”) will not apply to any transaction involving NDS, as a result of the place of central management and control of NDS for the purposes of the City Code. If the proposed transaction is consummated, NDS would cease to have a listing on NASDAQ or have publicly traded equity securities.

The independent committee, which includes neither directors nor executive officers of News Corporation nor executive directors of NDS, will consider the proposed transaction and make recommendations as to whether NDS should enter into the proposed transaction and whether shareholders should vote to approve the proposed transaction. News Corporation executives who sit on the NDS board support the authority of the independent committee and understand it has retained its own independent legal and financial advisors to assist in its consideration of the proposed transaction.

NDS Group plc (NASDAQ: NNDS), a majority owned subsidiary of News Corporation supplies open end-to-end digital technology and services to pay-television platform operators and content providers.

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