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News Corp. Acquires All of Fox

From Bloomberg News

Rupert Murdoch’s News Corp. persuaded Fox Entertainment Group Inc. minority holders to accept $6.6 billion for their stock, giving him full control of assets including Fox News Channel and the 20th Century Fox film studio.

Fox’s investors will get $36.72 a share in News Corp. nonvoting shares for their stock, based on Friday’s closing prices. Minority investors held 178.4 million shares, or 18%, in Fox, and will get 2.04 News Corp. shares for each one of Fox.

Purchasing the stock gives News Corp. all of Fox’s $12.2 billion in annual sales. Getting Fox businesses including TV stations and the Fox sports cable channels also gives Murdoch assets to trade with Liberty Media Corp. Chairman John Malone to reduce Liberty’s 18% voting stake in News Corp., said Peter Mirsky, an analyst with Oppenheimer & Co. in New York.

Separate Fox shares became unnecessary when News Corp. moved its headquarters to New York from Sydney, Australia, in November, the company said when the Fox offer was made Jan. 10. News Corp. moved partly so it could be included in the Standard & Poor’s 500 index and attract new investors, the company said.

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Liberty in December exercised an option to trade nonvoting News Corp. stock for an 18% voting stake. Murdoch, who controls 29.5% of News Corp.'s voting shares, said Feb. 2 that an agreement to reduce Malone’s stake might be reached within nine months.

Malone, 64, last week called Liberty’s News Corp. holding a strategic investment and said he had not had “meaningful discussions” with News Corp. about reducing the stake.

On Monday, News Corp.'s Class B voting shares rose 4 cents to $18.36 on the New York Stock Exchange. They have fallen 4.4% this year. News Corp.'s Class A nonvoting shares fell 11 cents to $17.89. They have fallen 4.1% this year.

News Corp. first sold Fox shares to the public in November 1998, raising $2.18 billion by selling 20% of the company. Fox’s stock rose 63% since then.

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Fox shareholders resisted Murdoch’s initial $5.86-billion offer, and News Corp. on March 3 raised the offer after agreeing to settle with stockholders who filed a lawsuit to block the deal.


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