The upshot of the so-called stockholder rights agreement that the company initiated today is that Rupert Murdoch can make it prohibitively expensive for someone he doesn’t like to buy News Corp‘s soon-to-be-created publishing company (which will retain the News Corp name) or the entertainment one (to be called 21st Century Fox). The terms enable either company to flood the market with shares, which News Corp investors as of June 21 can buy at half price, if a hostile bidder acquires 15% of the stock. Murdoch also can buy shares to keep his voting stake at about 40%. News Corp says that the anti-takeover plan — popularly known as a “poison pill” — is “intended to protect the stockholders” from a move that directors of either new company deem to be “not in the best interests of the companies and their respective stockholders.” But it leaves open the possibility of a “merger, tender or exchange offer or other business transaction approved by either the Board of Directors.” In adopting the poison pill, Murdoch no doubt wanted to avoid a rerun of his 2004 run-in with John Malone. The Liberty Media Chairman seized an opportunity to raise his stake in News Corp from 9% to 16% when it reincorporated to the U.S. from Australia. Two years later, Malone agreed to turn over his News Corp shares in return for 38.5% of DirecTV, $550M in cash, and three regional sports networks.
News Corp Introduces ‘Poison Pill’ To Stop A Hostile Takeover After It Splits
What's Hot on Deadline
'The Middle' Series Finale: ABC's Fond Farewell To America's Beloved TV Family Is One "Heck Of A Ride"
'The Middle' Co-Creator On The "Bittersweet" Series Finale, Devoted Fans And Possible 10-Year Reboot
Latest Business News
- Harvey Weinstein Faces Federal Sex Crimes Probe As NYC & LA D.A.s Amble
- Michael Jackson Estate Claims ABC Didn’t Secure Rights For Special On Late Singer
- Bill Hader & Alec Berg Bringing ‘Barry’ To Produced By Conference
- ESPN Confirms Expanded Deal For UFC Rights, Elbowing Out Fox
- ‘Orange Is The New Black’ Star Danielle Brooks Signs With UTA
- Donald Trump Elevates Conspiracy Theory To Government Plot On White House Lawn