Very quietly, the main Murdoch family company, 21st Century Fox, has dropped the four year-plus part suspension of voting rights on its B-class shares held by foreign shareholders. The suspension started in April 2012 when the company found that more than 25% of its shares were held by foreigners, which is against United States law that restricts foreign ownership of television assets to a maximum of 25%.
Fox owns broadcast station licences in connection with its ownership and operation of 28 stations. Following the elimination of the suspension, Fox told the US Securities and Exchange Commission that it “remains in compliance with applicable US law”.
Fox didn’t disclose what the level of foreign ownership of the company’s voting shares had fallen to. But it’s known that in April 2012, before the suspension, around 36% of the B-class shares were owned by non-Americans. The Murdochs control Fox via their 38% holding of the voting shares, but they have no A-class non-voting shares left after selling them down over the years (including to finance the restructure of the trust that controls the family stake in it and in News Corp).
The foreign shareholders included key Murdoch backer Saudi Prince al-Waleed bin Talal, cutting his voting rights from 7% to 3.5%, as well as all Australian holders of class-B shares. The quiet announcement this morning says the decision to drop the suspension was taken on Tuesday, the day before Fox released its fourth quarter and 2015-16 financial results. It means Prince Al-Waleed bin Talal can now vote his stake in full. Perhaps the Murdochs feel they might need support at the company’s annual meeting later this year in the event of a challenge from restive shareholders. The company’s shares are down 17% in the past year, including a 4% slide overnight Thursday.