By Daniel McConnell
Update 7.50pm: The Taoiseach has said he is happy that Communications Minister Denis Naughten did not reveal any confidential information in his phone call to an INM lobbyist.
Speaking at an event in Dublin, Mr Varadkar said he was "satisfied" with Mr Naughten's explanation.
"Yeah his explanation was clear," he told reporters.
Housing Minister Eoghan Murphy said there was "absolutely" no need for Mr Naughten to resign.
Justice Minister Charlie Flanagan said he was satisfied no confidential information was given out by Mr Naughten.
Earlier: Denis Naughten denies divulging 'insider information' to INM
Fianna Fail leader Micheal Martin expressed concern.
"This may or may not have been a breach of new market abuse regulations," he told the Dail.
He added: "Any reading of the situation would seem to suggest that the inside track is alive and well."
Sinn Fein President Mary Lou McDonald said: "For all the guff about 'new politics', is this where we are at now?
"That the gold-plated few get access to ministers and get given a heads-up on decisions the minister has taken in advance. What kind of a way is that to conduct politics?"
Labour leader Brendan Howlin said the claims were "extraordinary".
INM said it would not comment on the claims "for legal reasons". Heneghan PR also declined to comment.
Additional reporting by PA & Digital Desk
By Juno McEnroe
Update 5pm: Communications Minister Denis Naughten has confirmed he told a PR executive for INM he would "likely" refer a merger with the Celtic Media group to the Broadcasting Authority of Ireland.
Facing Dáil questions this afternoon, Mr Naughten said he now wished the conversation had not taken place but he denied he had divulged “insider information”.
His comments come after reports today that this contact and detail was ultimately passed to businessman and INM major shareholder Denis O'Brien two months before it was made public.
It has also been reported that the office of corporate enforcement has concerns that the minister broke stock market rules and revealed insider information to the INM lobbyist.
Speaking in the Dáil, Minister Naughten said he had “acted to the letter of the law”.
— RTÉ News (@rtenews) April 18, 2018
As he faced accusations of possibly breaching his duty as a minister, Mr Naughten said it had been his "personal" opinion that he gave to the PR executive in a mobile phone call discussion.
He told the PR official and former government press secretary Eoghan O'Neachtain that he was “likely”to refer the media deal to a phase II assessment, which would be under the BAI.
The phone conversation took place, he said, either on November 10 or 11 2016, some months before it emerged the following January that the sales process would go to the BAI.
The minister insisted in the Dáil this afternoon that he had not divulged “insider information” to Mr O'Neachtain. It has been reported that this detail was passed to Heneghan PR before going from then INM chairman Leslie Buckley and then onto businessman Denis O'Brien.
Minister Naughten said he “acted to the letter of the law” and at all stages was going by the advice of his officials. However, he also confirmed there was no note of the phone conversation with the INM lobbyist and, furthermore, he told none of them about the contact and comments made.
But Fianna Fáil's Timmy Dooley pointed out these were his views as a minister and not personal.
Sinn Féin's Mary Lou McDonald also said this was “absolutely not appropriate”.
It has also been alleged that the minister "misled the Dáil" as he did not divulge this opinion about the deal in Dáil questions to the Social Democrats on December 26, despite having spoken to Mr O'Neachtain the previous month.