News Corporation and Vivendi Universal Sign Memorandum Of Understanding Regarding Acquisition Of Telepiu

Business Wire, June 8, 2002

Business Editors

NEW YORK--(BUSINESS WIRE)--June 8, 2002

Proposed Agreement Would Leave News Corporation With 50% Economic

Interest In Combined Platform With 2.35 Million Subscribers

News Corporation and Vivendi Universal today signed a memorandum of understanding with respect to the acquisition of the Italian pay-TV business, Telepiu, by a group of investors headed by News Corporation. The total consideration to be paid for Telepiu is 1 billion euros, of which 450 million euros will be payable in cash at closing.

In addition, there will be reimbursements of 500 million euros for certain future Italian Serie A soccer broadcast rights and for the sale of two terrestrial licenses upon completion of their sale. The agreement values Telepiu subscribers at the same price Stream subscribers were valued when Canal planned to buy Stream.

The agreement is subject to a number of conditions, including the completion of due diligence and regulatory approvals, and the agreement of Telecom Italia.

News Corporation will ask anti-trust authorities to approve the transaction under the same regulatory conditions imposed on the earlier proposal to sell Stream to Canal .

As part of the agreement, all litigation between the parties, including Stream's litigation against Telepiu and Canal 's litigation against NDS, will be postponed until the transaction closes. Upon closing, the actions will be withdrawn.

News Corporation (NYSE: NWS, NWS/A; ASX: NCP, NCPDP) had total assets as of March 31, 2002 of approximately US$42 billion and total annual revenues of approximately US$15 billion. News Corporation's diversified global operations in the United States, Canada, continental Europe, the United Kingdom, Australia, Latin America and the Pacific Basin include the production of motion pictures and television programming; television, satellite and cable broadcasting; the publication of newspapers, magazines and books; the production and distribution of promotional and advertising products and services; the development of digital broadcasting; the development of conditional access and subscriber management systems; and the creation and distribution of popular on-line programming.

For more information about News Corporation, please visit www.newscorp.com .