Saudi Prince Alwaleed bin Talal, the world's fifth-richest man, converted his 5.46% stake in News Corporation to voting shares and said he may buy more, a decision that may help cement Rupert Murdoch's control of the company.
Prince Alwaleed in an interview yesterday reiterated support for Mr. Murdoch, who last month extended News Corporation's poison-pill takeover defense to keep John Malone's Liberty Media from increasing its 18% voting stake.
"The situation is murky there," Prince Alwaleed said in the interview. "We don't know what his intentions are."
Prince Alwaleed owns $950 million of voting shares in News Corporation through his two Kingdom companies, he said in a statement yesterday.
Between that stake and the shares owned by the Murdoch family, he is "not concerned at all" because "we can really withstand any offense from anyone."
Mr. Malone, 64, has urged Mr. Murdoch to buy back more stock to increase returns to investors. Mr. Murdoch said last month that talks to reduce Liberty Media's stake had ended, and Mr. Malone said last month that an agreement probably wouldn't come this year. He called himself a long-term shareholder in New York-based News Corporation.
News Corporation shares rose 26 cents to $17.09 as of 1:15 p.m. in New York Stock Exchange composite trading. The stock has declined 11% this year.
"As the prince has signaled in the past, he's behind Murdoch," an analyst at Fulcrum Global Partners in New York, Richard Greenfield, who rates the shares "buy," said.
The stake held by Mr. Malone has been portrayed in some news reports, including in the Guardian newspaper, as a potential threat to Mr. Murdoch's succession plans for the company. News Corporation's so-called poison-pill defense extends until 2007.
"We're very close to Mr. Murdoch," Prince Alwaleed said in yesterday's interview. "We support their plan for growth internationally. If the price is right, we'll buy more.
"You should not look at this matter as being anti-Malone," he said. "You should look at it as being pro-Murdoch family."
Mr. Murdoch's 32-year-old son, James, is now chief executive of British Sky Broadcasting, the U.K. satellite broadcaster controlled by News Corporation. Rupert Murdoch's 33-year-old son, Lachlan, resigned in July as News Corporation's chief operating officer to move to Australia.
The succession is "a matter that has to be decided at the board level, not by the shareholders," Prince Alwaleed said yesterday.
In recent months, News Corporation has focused on Internet assets, after Rupert Murdoch told American newspaper editors that the news media hadn't moved fast enough toward digital activities. In July, News Corporation agreed to buy Intermix Media, owner of the Web site MySpace.com, for $580 million.