Two more U.S. proxy advisory firms on Tuesday urged investors to support a hedge fund's campaign to change the company's dual-class share structure, saying no investor should have voting rights that are different from others.
Reuters reports Egan-Jones and its bigger rival Glass Lewis recommended investors back a recapitalization plan at the company's Nov. 20 meeting where all stock would have one vote for one share. They join prominent proxy advisory firm Institutional Shareholder Services, which last week urged News Corp investors to do the same.
Voting for the nonbinding shareholder proposal, which was made by hedge fund Starboard Value, would be a signal that investors are intent on breaking Rupert Murdoch's control over the media empire that publishes the Wall Street Journal.
"The economic stake of each shareholder should match their voting power and ... no small group of shareholders, family or otherwise, should have voting rights different from those of other shareholders," Glass Lewis wrote in its report, which was seen by Reuters.
In its report, seen by Reuters, Egan-Jones wrote: "A one vote per share principle would provide an equitable approach to ensure that shareholders are given a fair voice that is proportionate to their stake in the Company and would be able to hold the management accountable of their actions through casting a vote."
The two recommendations, issued on Tuesday, come just days after the largest U.S. proxy advisory firm, Institutional Shareholder Services, threw its weight behind Starboard Value. Starboard, the activist investment firm run by Jeffrey Smith, submitted a nonbinding proposal to eliminate dual-class share structure, Reuters reported in September.
Murdoch and his family own a 14% economic stake in the company but control 41% of the votes.
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