Fox-News Corp merger scrapped as Murdoch looks to sell real estate asset

In October last year, a short statement was released revealing that Rupert Murdoch and News Corp were considering the possibility of merging with Fox, bringing the two companies back together after they were initially split in 2013. The merger would have been worth $US28 billion ($40 billion).

The news was met with mixed reactions, including pushback from both Fox and News Corp’s shareholders by way of statements at the time indicating that they held reservations about the proposed merger.

On Wednesday, the company released a new statement pulling the pin on the deal, saying that “in withdrawing the proposal, Mr. Murdoch indicated that he and Lachlan Murdoch have determined that a combination is not optimal for shareholders of News Corp and Fox at this time.

“As a result of this action, the special committee of the board of directors of News Corp has been dissolved. The board would like to express its appreciation for the special committee’s efforts on this matter.”

The retraction of the merger comes alongside news that News Corp is set to sell its stake in real estate listings site Move to commercial real estate information and analytics company, CoStar. Whilst no amount has been confirmed, reports suggest that the deal could be worth over US$3 billion ($4.3 billion).

News Corp currently owns 80% of Move – the parent company of realtor.com – with the other 20% being owned by REA Group.

Irenic Capital – who owns 2.6% of News Corp’s class B shares – vocally opposed the merger when it was first proposed. In light of the retraction, the activist shareholder has released a new statement commending the decision.

“Irenic is encouraged that executive chairman Rupert Murdoch and co-chairman Lachlan Murdoch have concluded that a combination with Fox is not in the best interests of News Corp and its shareholders. This is the right decision. Looking ahead, News Corp has an opportunity to create substantial value for its owners.”