The outlook for Rupert Murdoch's proposed takeover of satellite broadcaster BSkyB is growing dimmer: government lawyers are now drawing up a plan to halt the deal, Deputy Prime Minister Nick Clegg has urged the mogul to reconsider, and Culture Secretary Jeremy Hunt is now seeking new advice from media regulators about the proposed bid. The mounting pressure on the News Corp. chairman is due to a series of damaging phone-hacking allegations perpetuated by the now-shuttered 168 year-old tabloid News of the World.

On Sunday The Independent reported, "Downing Street sources confirmed that Government lawyers were drawing up a strategy to halt the £9bn deal which looked a certainty only a week ago." In other damaging news for Murdoch, Deputy Prime Minister Nick Clegg met with the family of Milly Dowler--the murdered girl whose phone News of the World allegedly hacked--and then urged the mogul to "Do the decent and sensible thing, and reconsider, think again, about your bid for BSkyB."

At the same time, Culture Secretary Jeremy Hunt, who--as the (News Corp. owned) Financial Times noted--previously said that phone hacking allegations shouldn't affect a News Corp. deal with BSkyB, is now "seeking fresh advice from regulators on News Corp's takeover bid," reports BBC News. Hunt reportedly said: "New things have come to light and I wanted to know if that had a bearing on the advice [regulators] gave me previously."

Prime Minister David Cameron, however, appears to be staying out of the fray for now. His spokesman told the (News Corp. owned) Wall Street Journal that "he would remain removed from the decision making process despite Mr. Clegg's calls for him to delay the decision on the takeover." Even the Dow Jones newswire (another News Corp. property) didn't strike a particularly positive note on the deal, writing:

The intense public and political scrutiny of News Corp's attempt to take full control of the U.K.'s biggest pay-TV company could significantly delay approval for the deal until a police investigation into the conduct of editors and reporters at the News of the World is completed, a process that could take years.