The approach, made last week and valuing BSkyB at close to £12bn, is understood to have been rejected by management as undervaluing the company. News Corporation already owns a 39% stake in the broadcaster.

BSkyB has thrived during the downturn, with the company on target to crack the 10 million subscriber base. Consumers have flocked to the broadcaster - with its promise of innovations such as high definition and 3D TV - and News Corporation has seen the opportunity to significantly boost its position with a takeover.

"BSkyB is on track to make more than £1bn in profits. Why wouldn't they look to take more of that?" said one source.