Voters OK News Corp. Move To U.S.
Rupert Murdoch's global media conglomerate News Corp. took another step away from its Australian roots Tuesday when shareholders approved a measure to shift its main share listing to the New York Stock Exchange in an effort to strengthen the company's finances.
At an annual meeting, holders of ordinary shares voted 91.3 percent of their stock in favor of the proposal, easily beating the required hurdle of 75 percent. Holders of preferred shares voted 96.2 percent in favor.
It was the latest move by News Corp., the parent company of Fox TV and Fox News Channel, to position itself as one of the world's most important media conglomerates.
Murdoch started the company with a newspaper in south Australia that he inherited from his father in the 1950s. It roared back from a bleak period in the 1980s and now makes up a far-flung empire that includes the Twentieth Century Fox movie and TV studio, the New York Post, The Times of London and the satellite networks BskyB in Britain and Star TV in Asia.
Murdoch said the company, which generates around 75 percent of its earnings and revenue from U.S. operations, will be in a "much stronger financial position" once the shift has been completed and may consider higher dividends in a few years.
News Corp. shares are expected to move their listing to the New York Stock Exchange sometime next month, coinciding with the stock's removal from the Australian benchmark index.
News Corp. assets in the United States also include book publishing and satellite TV. Last year it gained control of satellite television group DirecTV, expected to compete with cable providers like Time Warner Inc.
The move to Wall Street was only the latest installment in Murdoch's U.S. ambitions. The 73-year-old took U.S. citizenship in 1985 so he could control more than 25 percent of an American television company he wanted to acquire at the time.
The beginnings of his success were almost absurdly modest. He inherited from his father, Sir Keith Murdoch, the second major paper in the relatively quiet South Australian state capital of Adelaide in 1953. He went on to acquire tabloids in Sydney, Australia and London before moving to New York and the New York Post in the 1970s.
Despite its many U.S. holdings, News Corp. has retained its links with its Australian heritage, continuing to hold annual general meetings in the southern city of Adelaide, where it has its registered office.
Murdoch never apologized for using his newspapers to support conservative politicians and he told shareholders in Adelaide on Tuesday that his newspapers would continue to promote U.S. President George W. Bush's foreign policy.
News Corp.'s Australian subsidiary, News Ltd., will continue to be Australia's major newspaper publisher with a stable of titles covering most major Australian cities.
Earlier this year, Murdoch said the company's formal status as a foreign issuer in U.S. financial markets was limiting investments from several major institutional investors, some of whom have limits on how much foreign stock they can own.
Concerned about the impact on the Australian stock market and a lack of corporate governance provisions accompanying the shift to the United States, some local fund managers had opposed the plan to shift from Adelaide. However, recent talks between News executives and fund managers appeared to have won them over.
News Corp. accounts for up to 6 percent of the Australian stock market, with a market capitalization of about $31.4 billion that ranks it among the four largest on the benchmark S&P/ASX 200 index.
By Jamie Tarabay