Entrenched Corporate Leader: Rupert Murdoch of News Corp.

Rupert Murdoch, Chairman & CEO
News Corp. (NWS)   

It doesn’t really matter if shareholders like what billionaire Rupert Murdoch does or not.  The only day shareholders get any say is on the day of the annual shareholder meeting, and that is just for posterity.  Fortunately for shareholders Mr. Murdoch loves making money, loves having media properties, and is not afraid of doing high profile deals. 

He rolled out Fox as a public company and then rolled it back up into News Corp; he made what can only be considered one hell of a buy with MySpace; he will replace family in the company with others (or even other family); he took it from being Australian-based company into being a US-based company so the company wouldn’t be limited or barred from certain television and media ownership regulations barring foreign entities from controlling our media; he arguably won the better side of a DirecTV swap for a 19% voting stake in News Corp with Liberty’s John Malone; and how much more can be said.  He has also been able to withstand all criticism from other media sources of having more of a conservative bias instead of being “unbiased.”

Murdoch is nearly 76, and does deals and runs the company like he is 36.  He built News Corp after inheriting of “The News” in Adelaide in the early 1950’s, and started gobbling up media properties from there.  The stock had spent a considerable amount of time as being dead money, but now shares are up roughly 60% in 18-months.  He has the majority vote and controlling interest.  He wouldn’t be able to be ousted even if it had remained a dead money stock, but now he can show he has strong returns for new shareholders.  If you own News Corp stock, you are betting on Rupert Murdoch and his legacy more than you are betting on the pieces inside the company.  Many of those will come and go at the will of Mr. Murdoch.  Imagine how different the company would be if he just decided to punt the shares over a 3-year period and opened the company properties up for sale.  Imagine as much as you want, but taking the under is probably more in line.

As a reminder, here is the link back to the introduction of this CEO segment with the guidelines.

News Corp. is Rupert Murdoch, and he is News Corp.

Jon C. Ogg
January 19, 2007