Murdoch Plan to Reunite Empire Pushes Fox Down Most Since 2020
https://finance.yahoo.com/news/lachlan-m...-113141751.html
Christopher Palmeri
Mon, October 17, 2022 at 3:09 PM·5 min read

In this article:


(Bloomberg) -- Rupert Murdoch’s plan to combine News Corp. and Fox Corp., recreating the conservative-leaning media goliath that he split apart nine years ago, drew mixed reactions on Wall Street.

Several analysts said the potential recombination is unlikely to solve one of the key problems facing Fox and News Corp. -- low valuations relative to their peers. While News Corp. gained 3.4% amid a broad market rally, Fox’s Class A shares dropped 9.4% for the biggest decline since March 2020.

The 91-year-old patriarch of the global media empire is seeking to reunite the parent of Fox News with that of the Wall Street Journal and the New York Post, the companies said Friday. His family trust holds about 40% of the voting stock of each company, and recombining them would save corporate expenses and allow the bigger entity to more easily promote new businesses, such as sports betting, across multiple media outlets.

For Fox, the benefit of “greater scale and modest cost synergies is in our view largely offset by increased complexity,” Benjamin Swinburne wrote at Morgan Stanley. As for News Corp., colleague Andrew McLeod said there is “strategic merit in a potential merger” but that the timing of any asset sales or spinoffs would be critical.

So far no one from the Murdoch clan, which includes Rupert’s six children, has spoken publicly about the deal. The move would likely consolidate power in the hands of his son Lachlan Murdoch, 51, currently the chief executive officer of Fox. Son James Murdoch, a former executive at the family media empire, resigned from the News Corp. board in 2020, citing disagreements over news judgment and strategy.-- excerpt, rest at link above --