News Corp released a statement stating that the transaction is
expected to close in two weeks. Dow Jones has indicated that the
deal gives Liberty another 23.3 million ADRS, each of which represents
four preferred limited-voting ordinary shares, or 93 million shares
Analysts feel that by exercising the option now Liberty has made
a major saving. As per the agreement signed in March a deadline
of 28 September was placed on Liberty to exercise its option. Had
it refused News Corp had until 27 March 2005, to make Liberty buy
the same number of ADRs at the same price. The condition was that
News Corp was by then to have acquired an ownership interest in
The report states that the deal adds more than 1 percentage point
to Liberty's stake in News Corp., giving it close to a 20 per cent
economic interest in the company.
News Corp. chairman and CEO Rupert Murdoch controls almost 31 per
cent of the company's voting shares. However due to the large amount
of preferred stock on issue, his economic interest is closer to
19 per cent.
By the end of the year News Corp hopes to gain the final regulatory
approval for the purchase of a 34 per cent stake in Hughes Electronics,
the owner of DirecTV.