News Corp sued over “nepotism” claims
News Corp head Rupert Murdoch has found himself accused of nepotism and running his empire like a “family candy store” after striking a $675m deal to purchase his daughters TV production business, Shine.
Shareholders have filed a lawsuit in a Delaware court accusing Murdoch of “paying for nepotism” and the News Corp board of failing to stand up for the company’s interests.
In their suit the claimant’s state: “In addition to larding the executive ranks of the company with his offspring, Murdoch constantly engages in transactions designed to benefit family members.
“Although the transaction makes little or no sense for News Corporation and is far above a price any independent, disinterested party would pay for Shine, it is unsurprising that the transaction was approved by News Corporation's board.”
A News Corp spokesperson dismissed the lawsuit as “without merit”, adding that Shine represented a “very attractive” acquisition for the firms entertainment output.
If regulatory approval is forthcoming the deal is expected to close on March 31, at which point Elisabeth Murdoch will become the latest clan member to take a seat on the board.