Rupert Murdoch's News Corporation has withdrawn its bid to buy satellite broadcaster British Sky Broadcasting - BSkyB.

The news came Wednesday shortly before parliament was due to debate a motion put forward by opposition leader Ed Miliband urging Murdoch's company to withdraw the offer because of illegal phone hacking at his News of the World tabloid.

The motion was approved without a vote, according to reports of DPA.

A spokesman for Prime Minister David Cameron said the government welcomed the move, adding that Murdoch's company should now "focus on clearing up the mess and getting its own house in order".

News Corp already owns 39% of BSkyB, but may be compelled to give up even this minority stake if it is deemed not to be "fit and proper" by regulator Ofcom following the conclusion of current police investigations.

News Corporation was hoping to acquire the remaining 60.1% of BSkyB in a USD 12.5 B deal.

Public outcry against Murdoch and News International, the British arm of his media company grew after a report last week that the News of the World tabloid had hacked into the phone of teenage murder victim Milly Dowler in 2002 and may have impeded a police investigation into her disappearance.

The media baron was subsequently forced to shut down the 168-year-old tabloid on Sunday and flew to London in a desperate scramble to keep the BSkyB bid alive.

In recent days the scandal has taken on a political dimension, with Miliband repeatedly citing Cameron's links to Murdoch's associates.