Rupert Murdoch cancels proposed Fox-News Corp merger

Rupert Murdoch, chairman of News Corp and co-chairman of 21st Century Fox, arrives at the Sun Valley Resort for the Allen & Company Sun Valley Conference, July 10, 2018 in Sun Valley, Idaho.

Drew Anger | Getty Images

Rupert Murdoch has withdrawn the proposal to recombine Fox Corporation and press company.

Fox said on Tuesday that its board received a letter from Murdoch, its chairman, and his son and Fox CEO Lachlan Murdoch that “has determined that a combination is not optimal for shareholders” of either company at the time.

The potential merger had faced opposition from shareholders in recent months, who did not believe a merger would show News Corp’s true value. if it merged with Fox.

News Corp CEO Robert Thomson told employees on Tuesday that the decision to cancel the proposed deal would have no impact on employees, according to a memo reviewed by CNBC.

“As I advised at the start of this process, it is best not to speculate on speculation, and so if you hear from the media, shareholders, customers or others, please alert the communications team of your business,” Thomson wrote.

In October, the companies said they had formed a special committee to review the deal.

A combination of the two companies would have unified leadership in Murdoch’s empire and cut costs at a time when viewership is shrinking for both print and television. News Corp owns Dow Jones, publisher of the Wall Street Journal. Fox, with what was left of Twenty-First Century Fox’s $71.3 billion sale to Disney in 2019, owns the right-wing networks Fox News and Fox Business, which is a competitor to CNBC.

Murdoch had split the companies in 2013. The Murdoch family trust controls about 40% of the voting rights of the two companies.

– CNBC’s Gabrielle Fonrouge contributed to this article.

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