By Yasin Ebrahim
Investing.com -- Fox Corporation said Tuesday that Rupert Murdoch has withdrawn the proposal to merge Fox and News Corporation, as a tie-up isn't expected to be "optimal" for shareholders.
Fox Corp Class A (NASDAQ:FOXA) was up almost 2%, while News Corp A (NASDAQ:NWSA) was down more than 1% in afterhours trading.
Fox Corporation received a letter from K. Rupert Murdoch withdrawing the proposal to explore a potential combination of FOX and News Corporation, the company said. The proposal sought to recombine the media companies that were split nearly a decade ago. In 2013, News Corporation was broken up, with the struggling publishing business rolled into News Corp., while the entertainment business was called 21st Century Fox.
The withdrawal comes as doubt over the benefits of a merger had been growing recently among shareholders. Independent Franchise Partners, a major investor in News Corp and Fox Corp said recently, it was against Murdoch's plan to recombine the two companies as the move wouldn't realize the full value of the company.
"In withdrawing the proposal, Mr. Murdoch indicated that he and Lachlan K. Murdoch have determined that a combination is not optimal for the shareholders of FOX and News Corp at this time," it added.