UPDATED with dual-structure vote totals. Waxing nostalgic about 21st Century Fox’s decades-long run in the media business, Executive Chairman Lachlan Murdoch offered a tribute to his father, Rupert Murdoch, during the company’s annual shareholder meeting.
Barring a major twist in the long march toward a $71.3 billion deal to sell two-thirds of itself to Disney (a deal that should get final approval in mere weeks), the meeting at the Zanuck Theatre on the Fox lot was the last for Fox in its current form. Post-merger, it will adopt the slimmed-down new name Fox, to match a reduced portfolio consisting of the broadcast network, Fox News, Fox Sports and local TV stations. Lachlan Murdoch will run the new Fox as his brother, James Murdoch (who was not heard from during the meeting), embarks on a new chapter in venture finance.
Rupert Murdoch began with a brief, no-nonsense introduction and then his son offered eight minutes of reflection on the company that were largely a salute to his father.
The 87-year-old Australia-born newspaperman built a small print-based outfit into a global empire with TV, film and digital assets. As a “journalist at heart,” Rupert Murdoch has “defied conventional wisdom and succeeded where others had failed,” Lachlan Murdoch said. Fox’s evolution “began with my father’s unwavering belief in the power of innovation and consumer choice. He has always had a passion for engaging audiences with stories and experiences that endure. But perhaps the most enduring story is his own.”
Shareholders voted to elect Delphine Arnault, James Breyer, Chase Carey, David DeVoe, Sir Roderick Eddington, Jacques Nasser, Robert Silberman, Tidjane Thiam to one-year terms on the board of directors, along with the Murdochs.
The only other piece of business in the 20-minute meeting was discussion of a shareholder proposal to do away with the company’s dual-class ownership structure. The company announced in an SEC filing after the close of the market that it failed, with 61% (435,774,050) voting against the measure, and 37% (266,647,916) voting in favor.
Luke Martin, a spokesman for longtime Fox shareholder the Nathan Cummings Foundation, delivered a statement from the foundation asserting that 90% of U.S. companies have a “one-shareholder/one-vote” structure. Excluding the Murdoch family, he added, the owners of 75% of outstanding Fox shares have previously voted to abandon the dual-class setup. Having separate classes of shares “gives some shareholders disproportionate power while leaving others with no vote at all,” Martin said, inviting questionable decision-making by board members.
Responding on behalf of the company, Nasser said, “Dual-class structures are not uncommon … particularly in the media and technology sectors.” (So much so that the structure became a flashpoint this year in legal warfare between CBS and controlling shareholder National Amusements and has also irritated many Facebook investors dismayed by what they consider Mark Zuckerberg’s self-dealing.)
Fox’s dual-class arrangement has unlocked considerable value for shareholders, Nasser maintained, and has been responsibly managed.