Rupert Murdoch plans to combine Fox, News Corp.

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Rupert Murdoch has started a process that could bring his media empire together, News Corp revealed on Friday. and Fox Corp., saying they would consider combining at his request, nearly a decade after the companies split.

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Both have formed special committees to review proposals for a potential combination, they said.

If a deal is struck, the combination will give Murdoch more control over its media assets and help companies cut costs. Media companies have been battling sluggish ad sales growth for decades and catching users’ attention against social media and deep-pocketed content websites.

After years of expanding globally, Murdoch split his empire in 2013, placing the printing business in the newly created public entity News Corp. and television and entertainment under 21st Century Fox.

Murdoch said at the time that his vast media holdings had become “increasingly complex” and that a new structure would simplify operations. The split also shielded Fox’s entertainment assets from any potential financial fallout from a phone-hacking scandal involving the media conglomerate’s now defunct News of the World publication in the UK.

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The thinking at the time was that splitting the companies would ultimately generate shareholder value, according to a person familiar with the decision-making. This vision came to fruition when Fox sold most of its film and television assets to the Walt Disney Co for $71 billion in 2019.

The sale left Fox to focus on live events such as news and sports, rather than “disruptive” scripted entertainment content on streaming platforms, Wall Street analysts observed at the time.

Major streaming services, however, have started to bridge the protection gap. Apple Inc and Amazon.com Inc, two tech giants with deep financial resources, began bidding for sports, securing the rights to broadcast major league baseball, soccer and football games.

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Fox recently renewed a long-term deal with the National Football League to continue showing Sunday afternoon games, but dropped Thursday Night Football from Amazon.

The reunion of Fox and News Corp. would give the combined companies greater scale to compete and complement their assets, said the person familiar with the proposal. The combined companies would have about $24 billion in revenue.

Murdoch, 91, currently holds quasi-controlling stakes in both companies. His son Lachlan Murdoch is chairman and CEO of Fox Corp. Companies that adopt such arrangements generally subject subsequent mergers to the approval of a majority of shareholders unaffiliated with their majority shareholder, although it is not clear whether this will be the case in this case.

As of Friday’s market close, News Corp. had a market capitalization of $9.31 billion and Fox Corp. was $16.84 billion, according to Refinitiv. Shares of News Corp. jumped 5% and Fox about 1% in aftermarket trading.

The development was first reported by The Wall Street Journal earlier today.

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