Irenic has a stake in News Corp, but pointed to risks owning Fox, which it argued “is subject to litigation that may result in billions in costs”.
That legal action in which Dominion Voting Systems is suing Fox News and its parent company, Fox Corp, for $US1.6 billion over repeated claims that it rigged its voting machines as part of a conspiracy to steal the 2020 presidential election from Donald Trump. Murdoch’s deposition in the case was heard last week.
Perhaps for Murdoch the motive was to undertake one last corporate tidying up exercise as he gets deeper into his 90s that would pave the way for his eldest son Lachlan to more simply control the empire.
Independent Franchise Partners, a significant investor in Murdoch’s companies, said in late November that it opposed the deal.
Additionally, analysts from several major investment banking houses, including those that were traditionally close to the Murdoch camp, also pointed out the pitfalls of the proposed plan.
All questioned how consolidating the two companies would simplify the group. Many argued that one large company containing a myriad diverse media assets would make it less attractive.
Already Fox and particularly News Corp trade at well below their true value because of their complexity.
Shareholders and analysts had been vocal in their opposition to the plan.Credit:AP
Perhaps for Murdoch, the motive was to undertake one last corporate tidying up exercise as he gets deeper into his 90s that would pave the way for his eldest son Lachlan to more simply control the empire.
The reunification represented a reversal of the deal done ten years ago to split the company in two, which created two separately listed media companies.
Back in 2013, when Murdoch decided to split his multibillion-dollar corporate empire, News Corp was reeling from a phone hacking scandal at its UK tabloids and the print media business globally was deeply challenged.
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The empire has evolved significantly since then and investors are more focused on real simplification. There has been a push to break up parts of the empire – on the basis that maximising the value of Murdoch’s empire could require fragmentation rather than amalgamation.
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