Rupert Murdoch’s 21st Century Fox has made a US$80 billion bid to acquire Time Warner Inc, a move that would create a media powerhouse that would redraw the global landscape.
The offer has been rejected by Time Warner, but observers believe the move is unlikely to be the last by Fox and is likely to touch off other media mergers .
In a statement that confirmed an earlier New York Times report, 21st Century Fox said that the company “can confirm that we made a formal proposal to Time Warner last month to combine the two companies.”
“The Time Warner Board of Directors declined to pursue our proposal. We are not currently in any discussions with Time Warner,” it said.
Time Warner, which owns the CNN, TNT and HBO cable and satellite television networks, Warner Brothers movie studios, as well as other subsidiaries, rebuffed 21st Century’s bid, saying that it was not in the best interests of the corporation.
In a statement, Time Warner confirmed that its board, after consultation with financial and legal advisors, had rejected the bid and stated that there “are considerable strategic, operational, and regulatory risks to executing a combination with 21st Century Fox”.
It is speculated, however, that the attempted acquisition could be a sign of further dealing to come, with Forbes reporting “investors clearly see Time Warner as a company in play”.
Mr Murdoch, the chairman of News Corporation, which was spun off from 21st Century Fox last year, is currently in Sydney to celebrate the 50th anniversary of News Corp Australia’s national daily, The Australian.
While he has not yet commented on the attempted purchase, the report in the New York Times said that people close to the discussions say Mr Murdoch is determined to purchase Time Warner and “is unlikely to walk away”.
In a video to staff, Time Warner CEO Jeff Bewkes said that the board of directors had no interest in the unsolicited proposal from 21st Century Fox.
If ultimately successful, the purchase could lead to one of the largest media mergers in history and the creation of the world’s largest media group by revenue, according to Business Spectator.
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