Activist Builds News Corp Stake, Plans to Seek Changes
Starboard Value has built a stake in News Corp and the activist shareholder plans to push for strategic and governance changes at the Wall Street Journal parent. Starboard believes News Corp, one of the two arms of Rupert Murdoch’s media empire, trades at a significant discount to its fair market value due to its conglomerate structure, according to people familiar with the matter. Starboard plans to recommend News Corp spin off its digital-real-estate division, which includes a stake in Australian online-property-site operator REA Group and Realtor.com parent Move Inc.
The activist, run by founder and Chief Executive Jeff Smith, also plans to push News Corp to collapse its dual-class share structure, which gives the Murdochs voting power in excess of their economic ownership. Starboard’s stake in News Corp is “sizeable," the people said. The exact magnitude couldn’t be learned.
Reuters reported Friday that Starboard had taken a stake in News Corp. Murdoch and his family have a roughly 40% voting stake in News Corp, according to a recent securities filing. The family has a similar voting stake in Fox Corp., which owns Fox News along with local TV stations and the Tubi streaming service.
That means that effecting change without their consent could be difficult. News Corp earlier this year tried unsuccessfully to sell Move to CoStar in a deal that would have carried a roughly $3 billion price tag. The Murdochs last year proposed reuniting Fox and News Corp through a merger—they split apart in 2013—but withdrew the bid in January following pushback from shareholders including another activist, Irenic Capital Management, which took a small stake in News last year and helped whip up opposition to the proposed merger.
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