The Sun King, Rupert Murdoch, lost the support of his prince last week – and almost lost control of his media empire as a result.
But the real problem for Murdoch is that this war is far from over, and there are serious implications for News Corp’s struggling print empire in Australia – the weak underbelly that will be targeted by investors.
Long time Murdoch backer, the Saudi billionaire Prince Alwaleed bin Talal, kept on the sidelines last week as the News Corp founder faced an unprecedented investor revolt against the structure that entrenches his family’s control of the company with a minority stake.
The Murdoch family owns just 12 per cent of News Corp, but they own 40 per cent of the shares which control the company.
The backing of Prince Alwaleed with his 6.6 per cent stake is enough to make the family’s position virtually impregnable.
“We never vote against our partner Mr Murdoch,” a spokesman for Prince Alwaleed told the Financial Times, but the numbers speak more loudly than his words.
Only 87.59 million News Corp shares voted against a proposal to give a vote to every News Corp share, not just the Class B shares.
The Murdoch’s own 76.6 million of these shares.
This means barely 11 million of the 120 million voting shares not owned by the Murdochs were voted in support of the family’s control.
Prince Alwaleed owns 13.18 million voting shares. He quite clearly did not vote these shares with Murdoch.
Given the power of incumbency enjoyed by a serving chairman, who has the discretion to direct proxy votes, the result represents an astounding rejection by Murdoch’s fellow investors.
And Murdoch knows it.
Full article: Rupert Murdoch lost his Saudi prince and his Australian media empire is now vulnerable (The Age)