Three years after Mr Rupert Murdoch started his pursuit of US pay-TV platform DirecTV, the 72-year-old mogul unveiled the $6.6 billion (€6.1 billion) satellite television deal to a hostile market.

Although few questioned its strategic merits, shares in all the companies involved fell yesterday with Fox Entertainment losing a fifth of its market value.

Investors said the complex structure of the deal, in which Mr Murdoch's News Corporation will acquire a 34 per cent stake in DirecTV's parent company and then transfer it to Fox, had left all the shareholders disappointed.

Hughes Electronics, which owns DirecTV, fell almost 10 per cent. News Corp was down 7 per cent at midday in New York. The reaction took the gloss off Mr Murdoch's triumph in capturing Hughes after what he described as "three years of patient negotiations and frustration".

Mr Murdoch yesterday travelled to Washington DC to begin lobbying for regulatory approval.

Regulators, who last year blocked a merger of DirecTV and rival EchoStar, are expected to spend up to nine months scrutinising the transaction.

While investors welcomed Mr Murdoch's acquisition of DirecTV, they questioned his decision to transfer the Hughes stake to Fox. News Corp spun off a stake in Fox more than four years ago in an attempt to highlight the value of its US entertainment assets.

"We are less convinced that Fox is managed as an operating entity rather than a financing vehicle for News Corp," Ms Jessica Reif Cohen, Merrill Lynch analyst, wrote as she downgraded Fox shares to a "sell".

Mr Chase Carey, the News Corp executive who will run Hughes once the deal is completed, said he would tackle DirecTV's cost base and move to stem losses in Latin America, where both DirecTV and News Corp have competing satellite platforms. - (Financial Times Service)