Official: News Corp shareholders are powerless
April 20, 2012
When you don’t want the limelight, it seems like you just can’t shake it off. As more UK executives are arrested for bribing law enforcement and military officials, News Corps in America has had to suddenly, and arbitrarily, suspend the voting power of its foreign shareholders – holders that account for 36% of the stock.
Seems News Corp, in the process of renewing some of its broadcast licenses, reviewed its share register and was surprised to find 36% of voting shares were owned overseas, a mere 50% above the limit set by the FCC. So it has suspended half of their voting rights.
Normally such wholesale disenfranchisement might cause a revolution but News shareholders will hardly notice. The Murdoch family dominate the dominant A category of voting shares and lip service is the best other shareholders have come to expect.
However, some holders – particularly American ones – can be expected to be become more vocal, or maybe vote with their feet, as the stain that started in Wapping – the London East End HQ of Murdoch’s papers – spreads across the Atlantic. UK lawyers are now taking cases on behalf of American celebrities, or cases where hacking occurred while clients were in the States, to US courts, and there is still much talk of invoking the FCPA, Foreign Corrupt Practices Act, against News.
No wonder News Corp is busily hovering up as much of its own stock as possible. Maybe it is all a master plan to drive the stock price of what is, after all, a brilliantly successful mixed-media group in order to take it private again. Murdoch has always run News like a private company anyway, maybe he realises that to continue to do so he will now actually have to take it off the market.
Maybe he will share some insights when he gives evidence to the Leveson Inquiry next week….
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