Tomahawk, WI 08/06/2014 (Basicsmedia) – Twenty-First Century Fox Inc. (NASDAQ:FOXA) has withdrawn its unsolicited $75 billion takeover bid For Time Warner Inc. (NYSE:TWX) after chairman and the CEO, Rupert Murdoch’s claimed Time Warner did not want to engage in comprehensive talks. Fox’s stock has declined by 11% since it tabled the bid. New York Times Columnist, James Stewart, has said it could probably be good news for consumers as the move could only have raised problems in terms of regulatory issues.
The withdrawal comes as a surprise taking into consideration that Murdoch has always been persistent and willing to pay for the acquisition. The move on the other hand is a win situation for shareholders as Fox has authorized the repurchase of Class A stock worth $6 Billion
“I think it is probably good news for consumers. I thought this raised a lot of troubling regulatory issues, but putting that aside, I agree it makes strategic sense for him and he has always been persistent and willing to pay up,” said Mr. Stewart in an interview on CNBC.
The deal may have fallen off as a result of political anxiety because the merger could have affected the level of competition especially for small players in the industry. The fact that Twenty-First Century Fox Inc. (NASDAQ:FOXA)’s stock has plummeted in the market since the courting process is seen’ as one of the reasons why Murdoch’s decided to throw in the towel, early into the game.
Murdoch’s reputation for overpaying could also have worked to his disadvantage this time seen by the fact that Fox has been declining in the stock exchange.
“His stock did go down which I think disappointed him especially since he thought there were a lot of strategic rationales, for this. I think one of the reasons it went down is his reputation for overpaying, He did overpay for Dow Jones. He bid 67% premium over the shares at the time,” said Mr. Stewart
Time Warner Inc. (NYSE:TWX) is reported to have demanded $100 a share offer from Murdoch in order to begin talks, an amount that Murdoch was not willing to offer.