The move was announced along with the company’s annual results, which show pre-tax profits fell slightly to £1.2bn from last year’s £1.26bn.
BSkyB also reported revenues rose by 7%, with strong demand “across the board” for its services. It said Sky Sports viewing share was at a seven-year high, boosted by the open race for the Premier League title.
Part of BSkyB – 39% – is owned by Rupert Murdoch’s 21st Century Fox. That company owns 100% of Sky Italia and 57% of Sky Germany.
Mr Murdoch wants to sell these to BSkyB to free up cash for 21st Century Fox, which is trying to buy media giant Time Warner, the company that owns Game of Thrones maker HBO and news business channel CNN.
BSkyB broadcasts to 10 million homes in the UK.
A combined Sky Europe would have 20 million customers.
The company hopes the new structure will save it £200m by the end of the second financial year with further savings to come.
BSkyB shares fell almost 4% on the news, as it means higher debt levels and a stop to its current practice of buying back shares.