Murdoch wants Liberty standstill

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The Independent Online

Rupert Murdoch has invited John Malone to sign a standstill agreement that would prevent the Liberty Media tycoon from gaining control of News Corporation.

Rupert Murdoch has invited John Malone to sign a standstill agreement that would prevent the Liberty Media tycoon from gaining control of News Corporation.

Mr Murdoch plans to hold talks with his media rival in the next few weeks to seek an undertaking from Mr Malone that he will not add to his 17 per cent stake in News Corp's voting stock.

Speaking at the annual meeting of Fox Entertainment Group, where News Corp owns an 80 per cent stake, Mr Murdoch said he was comfortable with Mr Malone holding a large stake in News Corp but only if he signed a standstill agreement barring him from further stakebuilding. A News Corp spokesman said yesterday: "He [Mr Murdoch] said he expected they would meet in the next month or two." Liberty Media declined to comment.

Mr Murdoch was taken by surprise by a move earlier this month by Mr Malone to increase his stake in News Corp's voting stock from 9 per cent to 17 per cent.

Mr Malone insisted the move was not hostile but it prompted News Corp to put in place a poison pill defence against future attempts to take control of the business. The measure involves a heavily discounted rights issue to existing News Corp shareholders that would drastically dilute the holding of any unwanted predator.

However, Mr Malone is likely to be in the driving seat in any standstill agreement talks and could exact a high price from News Corp in return for signing such an undertaking. Mr Malone is thought likely to take advantage of the situation by attempting a rebalancing of the two tycoons' business empires.

He could, for example, instigate a swap of certain News Corp assets for Liberty Media businesses or persuade News Corp to acquire Liberty assets that it was looking to offload.

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