BSkyB the satellite broadcaster owned 40 per cent by Rupert Murdoch's News Corporation has said it would launch digital satellite services from autumn

BSkyB, the satellite broadcaster owned 40 per cent by Rupert Murdoch's News Corporation, has said it would launch digital satellite services from autumn next year. Digital terrestrial television, available "through the air", is planned for introduction in 1998 if the Government's proposals succeed. Television's digital revolution has sent profits soaring at Pace Micro Technology, the soon-to-be-quoted maker of new-generation set-top boxes. In its pathfinder prospectus published yesterday, the Shipley-based manufacturer promised pre-tax profits in the year to 31 May of at least pounds 18.1m, up from just pounds 3.4m last time. Barry Rubery, joint chief executive, said the booming markets for digital services in Australia, Thailand and South Africa helped the company shift 250,000 set-top boxes in the year."We are now looking forward to the launch of digital in the UK," Mr Rubery said. Lucas's aerospace division would remain in the enlarged group, ending the company's previous search for a buyer, and so would Perkins, the diesel engine manufacturer owned by Varity.The two sides are also thought to have agreed that Sir Brian Pearse, the chairman of Lucas and former chairman of Midland Bank, would remain as chairman after the merger, and that Victor Rice, the British born chairman and chief executive of Varity, would be chief executive, replacing George Simpson, who is leaving to run GEC.A key issue to settle is the terms of the share swap for the all paper deal, which is expected to exclude any cash for shareholders, disappointing City institutions.Lucas plans to sell the merger on the basis of the benefits of bringing two complementary companies together, giving Lucas greater access to the US and Varity a better platform in Europe.There were suggestions that Lucas was holding out for a 65:35 split, giving Lucas shareholders the more powerful stake in the new company, but Mr Rice is certain to demand a better deal to give Varity shareholders greater weight.After speculation in the stock market that an offer was imminent, investors were unimpressed with Lucas's promise of silence for at least a week, and the shares slipped 2p to 235p.Another disappointment was the absence of any sign of other suitors for Lucas, including the rumoured TI, Siemens, GKN or General Motors..

Lucas yesterday moved a step closer to a pounds 3bn merger with Varity Corporation of the US, after a board meeting gave its blessing to the next stage of negotiations on the financial details. Lucas said in an upbeat statement - put out to prevent a false market in the shares after rumours of an imminent announcement - that talks with Varity were "proceeding well". The car components and aerospace company confirmed reports that the state of play would be discussed at the board meeting but played down speculation about an early announcement and said the meeting was not a make-or-break affair.A spokesman said an announcement was unlikely before early June, which puts a deal at least a week away.However, it is clear that the boards of Lucas and Varity have reached broad agreement on the basic industrial logic of a merger, which would produce one of the world's biggest brake suppliers.Lucas's brakes division would be combined with Kelsey-Hayes, Varity's brakes subsidiary, which recently built a plant in the Netherlands to gain a foothold in the European market. The best estimates now are that the sale will raise pounds 2.3bn to pounds 2.4bn, including the pounds 700m of debt being left in British Energy.A spokeswoman for the Department of Trade and Industry said that the figures used a year ago were "illustrative" and that pounds 8.5bn for liabilities was on the high side.The DTI also said the cash in the balance sheet had increased because of extra money from generating and from the nuclear levy.. It is increasingly clear that the Government can neither reassure the taxpayer that they won't be picking up the bill for nuclear privatisation nor reassure shareholders that they won't be taking on more than the Government is presently making clear."The break-down of the Magnox liability figures given a year ago showed that in addition to the pounds 2bn of cash, the Government expected to raise pounds 1bn from the future operation of the stations, pounds 1.4bn from the nuclear levy, and a further pounds 1.4bn through savings in liability costs and more effective decommissioning strategy.This totalled pounds 5.9bn - leaving another pounds 2.6bn to be found from the sale of British Energy. But he declined to repeat the pledge that the money raised from the British Energy sale together with existing and future funds from Magnox generation would be enough to cover liabilities being left for the taxpayer to pick up.Mrs Beckett said: "The Government's answer reveals very little.

Ian Lang, President of the Board of Trade, wrote to his Labour opposite number Margaret Beckett saying Magnox Electric had cash and investments in its balance sheet of pounds 3bn. This compares with a figure of pounds 2bn used by the Government a year ago when it announced the nuclear sell-off and split the industry into two - British Energy, which owns the modern AGR and PWR stations and is being sold off this July, and Magnox Electric, which will remain in public ownership.At that time, the Government put the Magnox liabilities at pounds 8.5bn even though the cost was shown as pounds 9.8bn in the company's own accounts, and said that the flotation of British Energy would need to raise pounds 2.6bn to cover the shortfall.A report due out from ABN Amro Hoare Govett, British Energy's brokers, next Tuesday, is expected to cast doubt on whether the sale will raise that much.Mr Lang said in his letter to Mrs Beckett that she had shown a "complete misunderstanding" of the position with the Magnox reactors. Royal Insurance levied an annual charge of 4.8 per cent on policyholders' funds, while Sun Alliance with which it is about to merge, charged 5 per cent.For 25-year pensions, the average charge dropped to 1.8 per cent. But Guardian Financial levied an annual fee of 4.7 per cent, while the Pru took 2.5 per cent, like the Royal.The Securities and Invest-ments Board said it remained convinced that the benefits to policyholders of product disclosure will express themselves over the next 10 years.Comment, page 19. The row over whether nuclear privatisation will raise enough money to pay for the liabilities of the ageing Magnox reactors being left in public hands deepened last night even though the Government claimed to have found another pounds 1bn to cover closure costs. Large national brokers and networks use their financial muscle with life companies to force up commission rates by up to 30 or 40 per cent over the standard rate by promising to sell in volume.Money Marketing's survey shows that the Reduction In Yield - or average annual charges - levied on 10-year endowments sold last year was 3.2 per cent, up from 3 per cent in 1994.For 25-year pensions, annual charges ranged between the 0.8 per cent charged by Equitable Life and Guardian Financial's 8.1 per cent.