Twenty-First Century Fox is abandoning its attempt to take over Time Warner in a proposed deal that would have combined two of the world's biggest media companies, the Associated Press reports
The about-face announced Tuesday comes three weeks after Time Warner Inc. revealed that it had rejected 21st Century Fox's unsolicited $76 billion buyout offer, according to the AP.
Time Warner not only rejected the offer but tweaked its corporate bylaws to keep shareholders from calling a meeting to discuss it.
Most analysts figured Time Warner was just playing hard to get, but in a statement released Tuesday, Fox chairman and CEO Rupert Murdoch said:
"Time Warner management and its Board refused to engage with us to explore an offer which was highly compelling. Additionally, the reaction in our share price since our proposal was made undervalues our stock and makes the transaction unattractive to Fox shareholders."
With the proposed deal off the table, 21st Century Fox's board approved a plan to spend $6 billion buying back the company's stock during the next year, the statement said.
The statement came as both companies were set to release quarterly earnings reports on Wednesday. Analysts were preparing to tune in for clues of the courtship.
“I was kind of surprised because it happened so quick,” said Brad Adgate, VP of research at Horizon Media. “The talk was that he [Murdoch] was going to raise the ante to acquire Time Warner.”
For its part, Time Warner issued a statement indicating that the company is well positioned for success on its own.
Adgate told KPCC that Fox’s decision to withdraw its offer could be a negotiating ploy.
“Six months or a year down the road, they may revisit this,” Adgate said.
This story has been updated.