Rupert Murdoch's News Corp made a $2 billion takeover offer for Australia's Consolidated Media Holdings on Wednesday, boosting top shareholder and billionaire James Packer's warchest as he abandons media in favour of casinos.

Packer, who has built stakes in casinos in Australia, London, Macau and Las Vegas, indicated he would accept the offer in the absence of a higher bid for the pay-TV stakeholder, in which he holds 50.1 per cent.

For News Corp, a successful bid would double its stake in Australia's dominant pay TV business Foxtel to 50 per cent, and give it 100 per cent of content provider Fox Sports.

Packer recently took a 10 per cent stake in Sydney casino-owner Echo Entertainment, through his Crown Ltd amid speculation he wants to use Echo's licence to build a new casino complex in Sydney to attract more Asian high-rollers.

"It frees up more cash and gives him a bit more flexibility," said Paul Xiradis, managing director of Ausbil Dexia, which owns stakes in News Corp and Echo.

"He's shown his hand in Echo ... but his intentions are not well and truly understood," he said.

Shares in Consolidated Media jumped 10 per cent to A$3.39, just below the A$3.50 a share offer, which was pitched at a 14 per cent premium to its last close.

A sale would see Packer all but exit what was once a media empire, built up over decades by his father Kerry Packer and grandfather Sir Frank Packer, apart from a 10 per cent stake in television company Ten Network.

"My family has a long history in media but I am a pragmatist. This is a good deal," Packer was quoted as saying from London by the Australian Financial Review.

"This proposal would suggest that my long-term interests lie in the entertainment and gaming side of my business," he said.

Packer has a 48 per cent stake in Crown Ltd which owns Melbourne's Crown Casino, and has built up a casino business in Macau in partnership with Hong Kong businessman Lawrence Ho.

He is renowned for his perfectly timed sale of the Nine Network TV in 2006 for A$4.5 billion, one of the last big acquisitions by private equity before the financial crisis struck. The owners of Nine are now battling to refinance their debt.

EYES ON ECHO

Analysts believe Packer is seeking to control Echo, without necessarily making a full bid. Packer earlier this month successfully lobbied to oust the company's chairman, arguing he bungled the handling of a sexual harrassment allegation, and is trying to get regulatory approval to hold more than 10 percent of the casino group.

This week, Genting Group upped its stake in Echo Entertainment to almost 10 per cent, sources with knowledge of the matter said, putting the Malaysian gaming operator on par with Packer, although it is not clear if it is working with Packer or on its own.

The bid by News Corp's local unit, publisher of The Australian, The Daily Telegraph and Herald Sun, to increase its pay-TV interests comes as it is expected to announce deep cost cuts and job losses in its print business as soon as Wednesday.

"It makes sense for them to acquire Consolidated Media and the price seems reasonable," Xiradis said.

Rival Fairfax Media said earlier this week it would cut 1,900 jobs over three years. Fairfax's classified advertisements were considered 'rivers of gold' as recently as a few years ago, but revenues have collapsed as online web sites have snatched real estate, job and car ads

Seven Group Holdings, which has a 24 per cent stake in Consolidated Media, said it was 'considering its options' as it reviewed the News Corp offer.

Shares in Seven Group, controlled by Australian billionaire Kerry Stokes, were up 3 per cent at A$8.13 by 1.54 am GMT.

News Corp's locally-listed shares rose 0.1 per cent to A$20.06, while Echo was up 1.2 per cent at A$4.30 in an overall market up 0.6 per cent. Crown eased 0.5 per cent at A$8.66.