Ramping down what might be the most consolidated bargaining threat the pay-TV industry has ever seen, 21st Century Fox top executive Rupert Murdoch has pulled his company's $80 billion offer to buy Time Warner Inc.
"We viewed a combination with Time Warner as a unique opportunity to bring together two great companies, each with celebrated content and brands," Murdoch said in a statement. "Our proposal had significant strategic merit and compelling financial rationale and our approach had always been friendly. However, Time Warner management and its Board refused to engage with us to explore an offer which was highly compelling. Additionally, the reaction in our share price since our proposal was made undervalues our stock and makes the transaction unattractive to Fox shareholders. These factors, coupled with our commitment to be both disciplined in our approach to the combination and focused on delivering value for the Fox shareholders, has led us to withdraw our offer."
Fox's announcement sent Time Warner shares tumbling nearly 12 percent, and its own spiking nearly 8 percent, with Murdoch pledging to add $6 billion to a share repurchase plan set for 2015.
"Time Warner's Board and management team are committed to enhancing long-term value and we look forward to continuing to deliver substantial and sustainable returns for all stockholders," Time Warner said in a statement. "Time Warner is well positioned for success with our iconic assets, including the world's leading premium television brand, the world's strongest ad-supported cable network group, and the world's largest film and television studio. We thank our stockholders for their continued support."
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