The Department of Trade and Industry said the deal would have given BSKyB an unfair advantage among broadcasters negotiating for the rights to air Premier League games and that it would have widened the gap between richer and poorer teams.

BSYyB Chief Executive Mark Booth blasted the decision for setting ``an unfortunate precedent'' that will discourage future links between media companies and clubs. The ruling didn't forbid such deals, but the department will clearly be casting a wary eye: On Friday it referred another possible acquisition, by NTL Inc. for the Newcastle United club, to the Competition Commission for review.

Mr. Booth said BSkyB's planned purchase, far from harming British soccer, would have helped the game through superior marketing and technology.``This is a bad ruling for British football clubs who will have to compete in Europe against clubs who are backed by successful media companies,'' he said. In Italy, media magnate and former Prime Minister Silvio Berlusconi owns the AC Milan football club, and in France, Canal Plus SA owns the Paris St. Germain club.

BSkyB won't appeal, a spokesman said. He added that there are ``no plans'' to shed the company's 11 per cent stake in Manchester United, the Premier League's top club.

The decision raised questions about the relationship between Rupert Murdoch, who controls BSkyB through News Corp., and British Prime Minister Tony Blair, whose Labour Party benefited in the 1997 elections from the support of such Murdoch papers as The Sun and The Times. Mr. Murdoch, however, told the London newspaper Sunday Business that while he was ``disapointed'' he would't be starting ``a jihad on the government or anything like that.''

Mr Murdoch said BSkyB had offered ``a high price'' forManchester United and that he was surprised the concessions offered to regulators -- such as assurances that the club would withdraw from any talks between the league and broadcasters over broadcast rights -- weren't sufficient. He told the newspaper similar concessions had been enough for him to buy sports teams in the U.S., including the Los Angeles Dodgers baseball team. ``Our assurances in the U.S. have stuck,'' Mr Murdoch said. News Corp. also holds stakes in the New York Knicks basketball team, the New York Rangers hockey team and Madison Square Garden, where those two teams play their home games.

(The Asian Wall Street Journal)