By
Mayowa Adebajo
January 10th, 2024
While News Corporation is worth about $9.45 billion, Fox Corporation has a $14.76 billion market capitalization.
A possible merger between media companies News Corporation (NASDAQ: NWSA) and Fox Corporation (NASDAQ: FOXA) has gotten investors to consider what the outcome could be like. On Friday, news about Rupert Murdoch exploring whether to unify the two companies came to light. News Corp confirmed the formation of a Special Committee to start weighing the options of a potential merger with Fox Corporation. Further, into the announcement, the company added that it is not certain it would engage in such a transaction.
Following the Friday announcement, News Corporation stock popped while Fox Corporation declined. News Corp stock closed up 3.40%, while Fox Corp shed 9.41%. The companies saw the changes in their shares during the trading session on Monday, 17th October.
Notably, Murdoch is the chairman of Fox and the executive chairman of News Corp., And his son, Lachlan Murdoch, is the CEO of Fox and co-executive chairman of News Corp. The media proprietor split Fox and News Corp in 2013 and is now considering bringing them back together after almost a decade. If the plan becomes successful, Murdoch will have a unified leadership over Fox’s news, business, and sports channels and News Corp. Meanwhile, News Corp’s properties include the New York Post, HarperCollins, Barron’s, and The Wall Street Journal. While News Corporation is worth about $9.45 billion, Fox Corporation has a $14.76 billion market capitalization.
Is a Merge Between News Corporation and Fox Corporation Possible?
News Corp does not believe in a potential integration, but the merger could help Murdoch cut costs in his media empire. Notably, both companies have been seeing lesser audiences. As fewer readers patronize print media, cable television accounts for fewer viewers. Majorly, people have resorted to online news, streaming services, and social media for their news and entertainment, especially as they can find their preferred content on the go.
News Corp CEO Robert Thomson has assured employees that there is no finite agreement yet. He added, “there can be no certainty that any transaction will result from this evaluation.”
Furthermore, Fox Corporation and Fox News are currently dealing with a defamation suit. Dominion Voting Systems is suing the companies under the argument that they made false claims against its voting machines. The electronic voting company argues that Fox News and Fox Business falsely claimed that its machines rigged the 2020 presidential election between Donald Trump and Joe Biden. With the ongoing legal matter, Fox Corp and Fox News are facing a $1.6 billion defamation lawsuit.
Citing an anonymous source, CNBC said that a merger would put the corporation in a better position. According to the source, a merged company would put its acquisitions. It could also place it in a better spot to compete with the likes of Apple Inc (NASDAQ: AAPL), Google (NASDAQ: GOOG), and Amazon (NASDAQ: AMZN).
