Murdoch Drops Pursuit Of Time-Warner

Rupert Murdoch

After weeks of mounting expectations about a corporate takeover duel between 21st Century Fox and Time Warner, Rupert Murdoch surprised the media biz by withdrawing his $80 billion acquisition offer, according to Variety.

The statement from Fox came one day before both congloms report second quarter earnings. Although Time Warner’s board rejected Fox’s offer in June, biz watchers widely expected Fox to field another bid. Until the statement was issued, Time Warner execs were gearing up to deal with another bid that was expected to come on the heels of the earnings reports.

But in the statement, Murdoch bowed to the realities of the investors’ concerns about the proposed combination, which have weighed on Fox’s stock price during the past few weeks. Sources close to the company reiterated that the drop in Fox’s share price made it much harder to get a stock-and-cash deal done without hurting the interests of shareholders, at least in the short term.

Murdoch has a well-earned reputation for being a swashbuckling CEO whose firm control of the conglom allowed him to chart his own course. But the acknowledgment of shareholder interests seems to be a signal that the criticisms in recent years of the company’s corporate governance and handling of other fiduciary matters has had an impact.

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