NewsCorp Plans $3bn Stock Buy-Back

15 June 2005

Media magnate Rupert Murdoch has announced his US-headquartered News Corporation group is to buy back $3 billion (€2.49bn; £1.66bn) of its shares.

The move signals doubts that Murdoch has been successful in negotiations with cable TV pioneer John Malone over the 18% stake his Liberty Media International holds in NewsCorp.

The company, which has diverse assets including Fox TV in the US, controlling stakes in the UK's BSkyB, News International newspapers and US satellite TV platform DirecTV, is responding to calls from shareholders to put its cash to work.

However, Murdoch has said previously that NewsCorp would resolve the Liberty Media issue before any decisions were made on using its $6bn cash reserves. Observers now surmise a Liberty resolution is not imminent.

Malone has insisted he has no hostile intentions towards NewsCorp but his stake, the largest after the Murdoch clan's, is clearly making the family nervous and buy-back talks have been going on - and off - for months [WAMN: 13-Mar-05].

NewsCorp spokesman Andrew Butcher says the current plan "has nothing to do with Liberty. This is about our stock being undervalued."

Liberty Media is saying nothing.

Data sourced from Financial Times online; additional content by WARC staff