Murdoch officially notified the boards of both companies that the merger proposal was being withdrawn. The news was relayed in a press release, which said that a special committee formed to explore the corporate move has been dissolved.
Multiple shareholders in the companies had expressed their opposition to the merger in recent months. London-based investment firm Independent Franchise Partners, which owns one of the largest stakes of any investor not named Murdoch, at about 7% in both companies, took a stand against the merger last November. IFP said a combination would not realize the full value of both companies. That public position followed one by activist investor Irenic Capital, which owns about 2% of News Corp.
The companies last year announced they were looking into reuniting more than a decade after the split of 21st Century Fox, which held film, TV and digital assets and News Corp., which became home to publishing and digital properties such as The Wall Street Journal. The $71.3 billion sale of most of 21st Century Fox to Disney netted the Murdoch family an immense haul but also left it with a much smaller company controlling Fox News, the Fox broadcast network and other TV assets.
With scale taking on ever-greater importance in the media sector lately, the idea of bringing the separate entities back together could have helped the Murdochs keep pace with larger rivals. The company is also staring at a potential financial liability or settlement costs stemming from the $1.6 billion Dominion Voting Systems lawsuit against Fox News. A number of top news personalities and executives including Rupert Murdoch and his son, Lachlan, who runs Fox Corp., have been deposed in recent weeks. Although the company has repeatedly asked for the suit to be dismissed, the judge in the case has refused, and a trial is still scheduled to start in April.
In addition to Fox News and the broadcast network, Fox Corp.’s other properties including streaming service Tubi, Fox Sports and a string of local TV stations. News Corp. has, alongside the Journal, Dow Jones, HarperCollins Publishers and Realtor.com.
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