The World: Sydney - Murdoch and Packer call off Consolidated buyout

Lachlan Murdoch and the Australian gaming magnate James Packer have abandoned their proposed $2.9 billion takeover of the Packer-backed publishing company Consolidated Media Holdings.

Murdoch said the deal was being called off because of what he called "material changes in overall transaction terms". The takeover would have been Lachlan Murdoch's first big move since quitting his father Rupert Murdoch's business in 2005.

The deal is believed to have foundered over Murdoch's private equity partners and financial backer, Providence Equity Partners, demanding that the price per CMH share be cut after Murdoch said he wanted to reduce his stake in the venture from 50 per cent to 25 per cent.