Murdoch re-elected Twenty-First Century Fox chairman

Reuters

By Sue Zeidler

LOS ANGELES, Oct 18 (Reuters) - Media mogul Rupert Murdochwas re-elected chairman of Twenty-First Century Fox Inc despite protests from shareholder groups who sought to separatethe chairman and chief executive positions of thefamily-dominated company.

Shareholders elected the 82-year-old CEO, his two sons,Lachlan and James, and the rest of the company's 12-person boardduring the meeting on Friday at the Fox studio lot in LosAngeles.

Shareholders Christian Brothers Investment Services and theBritish Columbia Investment Management Corporation in Canadaunsuccessfully proposed the appointment of an independent chairof the company, citing "the level of family control, and theinfluence this may bring to the impending reorganization."

Proxy advisory firm Institutional ShareholderServices recommended shareholders vote against Murdoch and eightother directors including his sons, saying the company shouldhave put its poison pill plan to a shareholder vote.

News Corp announced the poison pill provision in May beforeMurdoch split News Corp into two companies, with News Corpretaining the newspaper and other media assets and Twenty-FirstCentury Fox holding the movie, TV and other entertainmentproperties. The poison pill would be triggered to prevent ahostile takeover if a buyer acquired 15 percent or more ofeither company.

"Our new company deserves a fresh start" Timothy Schaler, aninvestor adviser for Christian Brothers, said at the meeting."For the board to ignore such a mandate shows disregard forcorporate governance."

In addition to its recommendations to vote against theMurdochs, the ISS proxy advisory firm recommended a rejection of Twenty-First Century Fox president Chase Carey and boardmembers David DeVoe, Roderick Eddington, James Breyer, Viet Dinhand Alvaro Uribe.

It endorsed independent directors Delphine Arnault, JacquesNasser, and Robert Silberman, who were added to the board inJune.

Twenty-First Century Fox countered the ISS rejection ofboard members by contending it needs Rupert Murdoch's "uniqueinsight and strategic vision" in the joint ceo-chairman role andsaid the current board has delivered good returns forshareholders.

Class A shares of Twenty-First Century Fox was trading at$34.33, up 0.4 percent, in mid-afternoon trading on the Nasdaqexchange. It has jumped 16.9 percent since July 1, its first dayof trading after the split.

"The company has articulated a strong case for long-termgrowth after the separation and they have begun to executeimpressively. We think the separation so far has been a terrificmove," said David Bank, analyst with RBC Capital Markets.

ISS' recommendations were a reversal from last year when iturged shareholders to back the slate.

But in 2011, ISS recommended clients vote against almost allof the board members amid News Corp's telephone hacking scandalthat prompted the closing of the News of the World tabloid andscotched its bid for the remaining stake of British pay-TVprovider BSkyB.

The annual meeting in 2011 attracted about 100 protesters,TV crews and Tom Watson, a British member of parliament, whoflew in to voice complaints about the hacking scandal.

The Murdochs control 39.4 percent of the company's votingrights through Class B shares, according to the company proxy.HRH Prince Alwaleed Bin Talal Bin Abdulaziz, a frequent Murdochally, owns 7 percent.

"The shareholder proposals are interesting politically butnot realistic since Murdoch's got the support of Alwaleed andthe family's own holdings," said Matthew Harrigan, analyst withWunderlich Securities Inc. "Additionally, the stock hasperformed very well," he told Reuters on Wednesday.

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