Fox Shares Tumble 5% on Murdoch Succession Pact
A $3.3 billion payout to siblings as part of the deal pressures the media giant's stock as Lachlan Murdoch assumes sole control.
Shares of Fox Corporation (FOX) dropped more than 5% after the Murdoch family finalized a long-awaited succession agreement. The deal cements eldest son Lachlan Murdoch's control over the global media empire but includes a massive payout to his siblings, spooking investors and driving heavy trading volume.
The settlement resolves a years-long dispute over the future of News Corp and Fox Corporation, the parent companies of major outlets like Fox News, The Wall Street Journal, and The Times of London. The core of the market's negative reaction centers on the terms of the buyout for Lachlan's three older siblings, James, Elizabeth, and Prudence. The agreement stipulates they will , a move partially funded by the sale of company stock, creating significant downward pressure on the share price.
Under the terms of the newly structured family trust, until 2050, ensuring continuity of the conservative editorial direction established by his father, Rupert Murdoch. While the deal provides long-term stability and a clear line of leadership, the immediate financial implications have been the focus for Wall Street. The three elder siblings will also be subject to a standstill agreement, preventing them from acquiring company shares or acting against the firm's interests in the future.
The resolution comes after a probate court previously blocked an attempt by Rupert Murdoch to grant Lachlan full control, which the court described as a 'carefully crafted charade.' Now that the family has , analysts believe it ensures 'business as usual' for the media conglomerate. However, the cost of achieving that stability has proven to be steep for shareholders in the short term.