Another serious attempt is being made to unseat the Murdoch clan from its controlling stake in News Corp via the company’s restrictive dual voting structure — as forecast in Crikey yesterday — and Australian fund manager Perpetual has emerged the key determinant in whether the move fails or succeeds. Based on last year’s strong vote in favour of ending the dual-class voting system, Perpetual, now the second largest holder of the key B class voting shares, will either make or break the idea, or could push its own views, which seem to indicate a desire to again split the company.

Perpetual has emerged with more than 10% (or more than 20 million) B class voting shares in News and is the second largest shareholder, having replaced International Value Investors, according to the 2014-15 proxy statement. Crikey revealed yesterday that International Value Investors had cut its stake to 4.32% of the voting shares (from a peak of more than 7.3% in February of this year) for no clear reason. Seeing International Value Investors was not mentioned in the latest proxy statement, it might have sold the rest of its holding. The Murdochs have a total holding of 39.1% of the B class voting shares (including Rupert Murdoch’s stake).

The move overshadows a rise in Rupert Murdoch’s pay as executive co-chair of News to US$5.34 million (in cash, shares and inventive payments), the highest since he was paid US$8.7 million in 2013-14.  It was up 5.6% from 2015’s US$5.06 million. Rupert Murdoch was paid a record US$34.59 million at 21st Century Fox, so his total take from the two family controlled companies was nearly US$40 million, or close on A$53 million for the year to June.

The much-delayed proxy statement from News Corp for its 2015-16 annual meeting reveals that for the third year in a row, the Nathan Cummings Foundation of New York has lodged a proposal to be considered at the meeting calling for an end to the dual voting structure.The same motion almost got up at the 2015 AGM, where it garnered 49.5% of the vote. While a non-binding measure, it has the potential to force the Murdochs to change the voting structure over time. It is interesting that the same proposal has not been lodged for the AGM of 21 Century Fox.

News Corp has scheduled its AGM in Los Angeles a few hours after the AGM of its stablemate, 21st Century Fox, at the Fox Studios in Los Angeles, in an effort to help ensure the defeat of the foundation’s attempt to end the dual voting structure at the media group and end the Murdoch clan’s control.  The 2015 AGM was held in New York, where News Corp and many of its big US investors, such as International Value, are located.

The Cummings Foundation again raised the proposal back in March of this year (the proposal for the AGM is the same word for word as in previous years). News Corp said it would engage with the group for further talks, but nothing more was said. But it appeared something was going on when the 2015-16 proxy statement was delayed. In 2015, the statement was issued on September 1, and the 2014 statement was issued on September. 30. It is understood talks between News and its advisers and the foundation have continued, but ended when it became clear the foundation would not withdraw.

Given the closeness of the 2015 vote and the appearance of Perpetual as the second largest holder of voting shares, the Murdochs are scared the foundation’s vote will be approved at the meeting. And Perpetual and its head of equities, Paul Skamvougeras, is already on the record as demanding News unlock its value. In fact he and Perpetual seem to want a break up of some sort at News, which would be anathema to the Murdochs.  — Glenn Dyer