Mounter quits as StarTV chief

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RUPERT MURDOCH'S pounds 350m purchase of StarTV claimed its first executive casualty yesterday when Julian Mounter quit as chief executive of the Asian satellite station after being told that his immediate boss would be Sam Chisholm, the head of BSkyB.

Mr Mounter is understood to have said he would report directly only to Mr Murdoch or the board of his News Corporation, which owns 50 per cent of BSkyB, the UK satellite venture.

Mr Chisholm has told Star staff that the announcement of a new chief executive is imminent, possibly by the end of this week, and there was speculation that he was himself in line for the job.

An urgent appointment is necessary as this is a delicate time for Star. News Corp's purchase has drawn criticism in Asia, particularly from the Malaysian government, which has warned about the creeping influence of Western media. And yesterday News Corp announced plans to raise Adollars 500m ( pounds 230m) to help pay for Star by issuing 25 million convertible preference shares at Adollars 20 per share through an institutional placing.

It is not thought that there was personal animosity between Mr Mounter and Mr Chisholm, and the two have been friends for some years. 'Julian wasn't forced out,' an executive at Star said. 'It is just that his way of working is to report to the top man.'

But it does raise questions about the future role of Mr Chisholm who, although chief executive of BSkyB, is directly employed by News Corporation. He was closely involved in last week's negotiations to buy the 63.3 per cent stake in HutchVision, which controlled Star, from the Chinese billionaire Li Ka-shing. Mr Murdoch snatched the satellite station from under the nose of Pearson, which until the last minute was negotiating a sale with Mr Mounter.

News that a new Star chief executive would report to Mr Chisholm heightened speculation about closer links between the Asian station and BSkyB. Star is expected to tap into BSkyB's news and sports service, although observers say a merger is out of the question. 'They are two distinct operations, too far apart,' one said.