Lachlan Murdoch, now flying solo without the constraints of his more progressive siblings, has taken control of his father’s global media empire, securing the future of the Australian stable of newspapers, magazines and news channels.
An Australian resident who raises his two children with his wife, Sarah, in the affluent Sydney suburb Bellevue Hill, Lachlan is committed to the Australian business which includes Sky After Dark’s lineup of rightwing pundits.
Rupert’s three “objecting children”, as a Nevada court described them, will receive an estimated $US1.1bn each for their shares in the business. An out-of-court deal was reached after the failure of Rupert and Lachlan, who celebrated his 54th birthday on Monday, to change the terms of the irrevocable family trust.
James, 52, Elisabeth, 57, and Prudence, 67, will cede control, thereby removing more moderate voices from the conglomerate.
Announced in the US on Monday, the deal resolves a succession fight over who will control the voting powers after the eventual passing of the 94-year-old patriarch, who has long used a controversial share structure to assert control over News Corp and Fox Corporation.
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The eldest son, Lachlan will now be what Rupert has described as the “protector of the conservative voice in the English-speaking world”. That includes Australia where his conservative media assets include a national broadsheet, The Australian, and state-based tabloids that dominate the landscape.
While News Corp’s Australian property division, REA Group, was likely unassailable as it is a highly profitable arm of the business, the mastheads and the rightwing Sky News Australia were relatively insecure while the “objecting” siblings were pushing to rein in the more extreme arms of the company.
Even though News Corp is best known for its traditional media assets, they are not part of what the company calls its “core growth pillars”, a title reserved for its HarperCollins book publishing, REA Group, and Dow Jones information business.
Most of the newspapers, including in Australia, have been subject to weak advertising conditions that have buffeted media companies around the world. Despite shifting to a subscription model, many have struggled to increase revenue in the digital era.
Insiders welcomed the “certainty around assets and certainty around governance” the deal brought to the publishers of The Australian, the Daily Telegraph, digital news site news.com.au, Courier Mail, Advertiser, Herald Sun and multiple regional websites.
In 2020 James criticised the Murdoch newspapers for their “ongoing denial” of climate change. The Australian and Sky News in particular have repeatedly cast doubt on the link between the climate emergency and the bushfires.
“It takes away the uncertainty of wondering what would happen when Rupert died and the other kids decided to sell a lot of the business, in particular Fox News,” one source said.
Lachlan cut his teeth in media working at News Corp’s Sydney headquarters in Holt Street on The Australian, and in Queensland at the Courier Mail, and is committed to the publishing side of the business, sources close to the company say.
His Australian lieutenant, the chief executive of broadcasting, Siobhan McKenna, advised him to use the trust case to force the parties back to the table and was very heavily involved in negotiations, which remained a well-kept secret until the deal was unveiled on Tuesday morning local time.
News Corp is the largest publisher not just of newspapers but of magazines in the country, and its stable includes Taste.com.au, Vogue Australia, GQ Australia, Body+Soul, Kidspot.com.au and Vogue Living.
News Corp’s global chief executive, Robert Thomson, the highest-paid CEO of an Australian-listed company, is Australian-born so the top brass spend a great deal of time here.
The new deal
Under the deal, a new family trust will be established to house the family’s stock holdings in the two media companies. Crucially, those shares are known as “B class” shares and give the owner voting rights.
They represent about one-third of News Corp’s voting shares, giving Lachlan a firm hand in any future corporate fight against dissident shareholders seeking a change in direction.
While sisters Grace and Chloe are included in the new trust, voting control will rest solely with Lachlan, giving him control until at least 2050.
This contrasts with the original structure of a family trust, whereby Lachlan, along with James, Elisabeth and Prudence, would have shared in the decision-making process via those B class shares.
Lachlan, who is chair of News Corp and executive chair and chief executive of Fox, is personally involved in buying the other Murdoch children out, in a sign he is as invested in the future of the media conglomerate as his father.
