Saudi Prince alWaleed bin Talal, a key ally of Rupert Murdoch, sold his stake in the 21st Century Fox – leaving the Murdoch family vulnerable to a rebellion from the company’s shareholders.
One of the richest man in the world, Prince alWaleed owned six per cent of Fox through investment firm Kingdom Holding at one point. A shareholder in various Murdoch companies including Fox, News Corp, Times and Wall Street Journal, the Saudi prince has consistently backed the Murdoch family into keeping the controlling share. He even publically supported Murdoch after the phone-hacking scandal at the News of the World in 2011.
While Fox declined to comment, Kingdom Holding did not respond to a request for comment.
Prince alwaleed is among the 11 Saudi princes arrested over the weekend in an “anti-corruption crackdown” prompted by Crown Prince Mohammad bin Salman. The arrested include four ministers and dozens of former ministers.
While the regulatory filings in New York show that his stake reduced to 4.98 per cent in December 2015, an analysis of Bloomberg data found it to have fallen to a zero since the end of the last financial quarter [September 30].
Regulatory filings in New York show Prince Alwaleed reduced his stake to 4.98% in December 2015, and an analysis of Bloomberg data shows the stake has fallen to zero since the end of the last financial quarter, on 30 September. But it is not clear why or to whom the stake was sold.
The surprising turn adds to speculations that Fox was holding talks with Disney about selling most of the company. Murdoch family controls about 39 per cent of voting rights in Fox – giving them control of key decision, however, they own only around 17 per cent of the shares.
The media outlet is run by Rupert Murdoch and his sons Lachlan [executive co-chair of 21st Century Fox] and James [chief executive of Fox]. The £11.7bn deal where Fox is trying to buy 39 per cent of Sky is under investigation by the United Kingdom’s Competition Markets Authority on the ground of media plurality and commitment to broadcasting standards.
The proposed takeover suffered another setback when earlier this week media regulator Ofcom ruled that the coverage Donald Trump’s Muslim ban and Manchester Arena bombing by two programmes on Fox News breached UK broadcasting standards.
But on Wednesday night, Fox reported revenues of $7bn for three months ending September 30, 2017 – better than expected quarterly results.
The Murdochs have declined to comment on Sky deal beyond public information, insisting that the deal will be finalised by mid-2018. Lachlan said that the company will not disclose any information on talks with Disney, and dismissed reports that the family had concluded Fox was unable to compete with rivals including Amazon, Google and Netflix – considered as the main reason behind the sale of the company.
“Fox has the required scale,” Murdoch said. “We are excited about all our brands and the opportunities they offer the company.”
The shareholders at Fox, unhappy with the company’s performance and its dealing with sexual harassment scandals at Fox News, are expected to show rebellion at its annual general meeting on November 16. A proposal to eliminate the shareholding structure allowing Murdoch controlling share has already been tabled by The Nathan Cummings Foundation, Fox has recommended shareholders to oppose the motion.
The CtW Investment Group, which represents pension funds, also recommended an overhaul of the board of director in a letter to Fox last month. The letter also urged for the departure of Sir Rod Eddington as a non-executive and replacement of ‘insiders’ with independent directors.
The group also called for creation of corporate responsibility, compliance committee and condemned the board for its slow response to the scandals.
“The board stands at a critical juncture. The cultural crisis that has been exposed over the last 15 months at Fox News is a clear illustration of corporate control problem at 21st Century Fox. We would like to see the board take steps to minimise the risk of such a crisis in the future,” the CtW said in the letter. “We sincerely believe these governance changes are critical to ward off future corporate crises at Fox.”
COURTESY BY: https://tribune.com