Rupert Murdoch's Fox abandons Time Warner takeover bid
By Jennifer Saba and Soyoung Kim
(Reuters) - Rupert Murdoch's Twenty-First Century Fox (FOXA.O: Quote) decided to pull its $80 billion offer to buy Time Warner Inc (TWX.N: Quote) on Tuesday, abandoning plans to create one of the world's largest media conglomerates.
The surprise announcement appeared to cut short what many investors had viewed as an inevitable battle of attrition over a deal that would have joined two of Hollywood's biggest studios and TV networks from TNT to Fox News.
Murdoch, who is Fox's chairman and CEO, cited Time Warner's management and its board's refusal to come to the table to discuss a takeover as one reason for the stunning turnabout.
"Our proposal had significant strategic merit and compelling financial rationale and our approach had always been friendly. However, Time Warner management and its board refused to engage with us to explore an offer which was highly compelling," he said in a statement released after the market closed on Tuesday.
Murdoch also cited Fox's share price - down about 11 percent since the offer was unveiled on July 16 - saying it had become undervalued, making the deal "unattractive to Fox shareholders."
Time Warner, which had fiercely resisted Murdoch's advance, issued a statement saying it was committed to enhancing long-term value. "We look forward to continuing to deliver substantial and sustainable returns for all stockholders," the statement said.
Shares of Fox rose 10.4 percent in after-market trade after closing at $31.30. Shares of Time Warner fell 10.7 percent after closing at $85.19.
A source familiar with the matter said that there were no other likely bidders for Time Warner at this point. Continued...