News Corp. suspends voting rights of some Class B shares
News Corp.'s board of directors temporarily suspended the voting rights of a portion of shares held by non-U.S. citizens to comply with U.S. law, according to a regulatory filing.
The media conglomerate Wednesday suspended the half of the voting rights of foreign citizens who hold Class B shares in News Corp. The company said its board took the action to comply with U.S. law, which limits foreign ownership of broadcast licenses to no more than 25%.
The decision would impact Saudi Prince Alwaleed bin Talal bin Abdulaziz, who holds more than 56 million Class B shares.
News Corp.'s 27 owned and operated television stations, and Fox Broadcasting Co., are lucrative assets, together generating $4.8 billion in revenue and $681 million in operating profit in 2011.
The board determined that about 36% of the company's Class B stock was held by non-U.S. shareholders, and immediately suspended the voting rights of 50% of this class of stock held by foreigners.
As part of the announcement, Chairman and Chief Executive Rupert Murdoch and the family trust -- which hold nearly 318 million shares of Class B stock -- agreed to cap their voting power. The Australian-born Murdoch became a U.S. citizen in 1985 to comply with the foreign-ownership restrictions on U.S. broadcast licenses.
"The suspension of voting rights will remain in place for as long as the company deems it necessary to maintain compliance with U.S. laws," the company said in a statement issued Wednesday.
-- Dawn C. Chmielewski