Say what you want about media tycoon Rupert Murdoch, but he doesn’t give up easily.
Less than two years after Time Warner Inc. (NYSE: TWX) rebuffed an unsolicited $80 billion takeover offer from Murdoch’s Twenty-First Century Fox Inc. (NASDAQ: FOXA), the media tycoon’s New York Post appears to be on a crusade to find a buyer for the corporate parent of Warner Bros. and CNN.
Earlier this week, the scrappy money-losing tabloid published a story titled “Time Warner’s Loyal Investors Would Support Sale of Company.” The story reported that CEO Jeff Bewkes “was slated to meet with one of the company’s biggest investors last week as he tries to head off a potential proxy fight … and was scheduled to meet with another investor this week.”
Oddly, the Post doesn’t name any of the funds with whom Bewkes supposedly was meeting because one of the paper’s sources declined to “name the fund” involved. The Post also notes that billionaire Carl Icahn was buying shares to “take another run at the company.” Icahn, though, later denied that he was planning anything of the sort.
The fact that Bewkes is meeting with shareholders is hardly surprising. It’s something that the Fortune 500 regularly do, as well they should. As for the Post’s claim that Bewkes is worried about a proxy battle, every CEO bloodied by the worst stock market start in history is in the same boat. Nonetheless, it doesn’t appear as though Bewkes needs to be overly concerned about activists. While Time Warner shares have slumped more than 15% over the past year, guess which stock has dropped more than 25%? 21st Century Fox.
Let’s suppose, for instance, that Murdoch’s dream had come true in 2014 and that Bewkes agreed to join forces with the Australia-born tycoon. Time Warner’s market capitalization is now about $55.7 billion, well under Murdoch’s 2014 offer price. Would 21st Century Fox have had to take a write-down of the Time Warner assets? Maybe. It is important to remember that Murdoch is motivated by power more than shareholder returns.
Despite a lack of evidence that Murdoch is somehow orchestrating a campaign to restart merger talks with Time Warner via the Post, one has to wonder. Though he has always denied meddling in the paper’s editorial policies, critics have accused him of doing precisely that. To its credit, the Post does mention 21st Century Fox’s past interest in the company, though it says it has no interest in making a new offer. It probably would have been a waste of time.
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