Rupert Murdoch's media empire made "veiled threats" to punish the Liberal Democrats if its controversial BSkyB takeover was blocked, Vince Cable has told the Leveson Inquiry.

The Business Secretary said he felt "under siege" and was "seriously disturbed" at what appeared to be a co-ordinated effort to politicise the decision.

He blamed the alleged pressure for his unguarded outburst to undercover reporters that he had "declared war" on Mr Murdoch - an outburst that saw him stripped of responsibility for media issues.

But although he accepted that it was right to remove him from the process, he insisted that none of his personal concerns about the influence of Murdoch newspapers would have affected his decision.

"I had heard directly and indirectly from colleagues that there had been veiled threats that if I made the wrong decision from the point of view of the company, my party would be - I think somebody used the phrase 'done over' in News International press," Mr Cable told the inquiry into media standards.

"I took those things seriously, I was very concerned."

Mr Cable, who refused to say who tipped him off to the threats, added: "I had myself tried to deal with the process entirely properly and impartially and I discovered this was happening in the background."

Setting out the context of his "war" remark to two Daily Telegraph journalists posing as constituents at a local meeting - he said he was already "tense and emotional" because of dealing with angry protesters.

The recent reports that News Corp representatives were "either trying to influence my views or seeking material which might be used to challenge any adverse ruling I might make" only inflamed his mood, he said.

It was "a new and somewhat unsettling experience" for a political party which had previously been all but ignored by the big media groups, he said in written evidence.