‘We Are Allies,’ Liberty Media Reassures NewsCorp

10 November 2004

US cable tycoon John Malone, big on the US cable scene and even bigger in Europe, moved on Tuesday to reassure his old comrade-in-arms Rupert Murdoch that his stock-gathering intentions are entirely honourable.

Having crafted with Merrill Lynch a scenario that next year will give him the opportunity to increase his present 9.2% voting stake in News Corporation to 17.2% [WAMN 05-Nov-04], Malone extended both arms, fingers outspread, to the highly suspicious clan Murdoch.

Speaking ventriloquist-style via Bob Bennett, president of his acquisition vehicle Liberty Media, Malone assured: "I would like to make it very clear that we view ourselves as allies of News Corp and the Murdoch family and we have no hostile intentions."

Why, then, the decision to acquire the controversial options?

Explained Malone/Bennett: "We recognised that there was going to be an exclusion of NewsCorp voting shares from certain Australian indices and there would be a supply of voting shares available for us and the spread between voting and non-voting has come down considerably. We saw an opportunity to buy a large block of voting shares."

But for what purpose, wonder onlookers?

Bennett wasn't saying, adding only that Liberty is aware of the potential poison pill planted by the Murdochs [WAMN 9-Nov-04] and now seeks regular and open dialogue over its interests in NewsCorp.

The Murdoch family controls NewsCorp via a mere 12.6% stake that prestidigitates into 29.5% of the voting rights. Could a Malone me-too be on the cards?

  • Meantime, Liberty unveiled its latest Q3 numbers, reporting sharply improved net income of $372 million (€287.70m; £212m), with a major contribution from home shopping channel QVC offsetting increased network programming costs. At the operating level, income rose almost 5% to $153m on sales up from $877m to $1.83 billion.

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