Rupert Murdoch’s 21st Century Fox said it made a bid to buy media conglomerate Time Warner but was rebuffed.
The bid was worth roughly $80bn (£46.71bn), or $85 per share in cash and stock, a source said.
Time Warner’s stock jumped 22.5 per cent to $87 pre-market as the New York Times reported that Murdoch was determined to buy Time Warner and was unlikely to walk away despite the rejection.
Twenty-First Century Fox confirmed that it had made the formal proposal to Time Warner last month.
“The Time Warner board of directors declined to pursue our proposal. We are not currently in any discussions with Time Warner,” Twenty-First Century Fox said in a statement yesterday.
Time Warner was not available for comment.
It was reported this month that Rupert Murdoch is in the midst of a deal that would give Fox the firepower to buy a content comp- any.
Fox first approached Time Warner, owner of the Warner Bros movie studio and cable channels such as HBO and CNN, in early June and delivered a formal takeover proposal later that month.
Fox, which owns movie studio 20th Century Fox and cable news channel Fox News, offered to sell CNN as part of its proposal to buy Time Warner to clear any regulatory hurdles, the Times said.
“I think fair public value is $82. (It) would be good deal for Fox if it goes through Washington (regulators) with CNN sales,” Wunderlich Securities analyst Matthew Harrigan said.
Time Warner’s board discussed the proposal at length and sent a terse letter rejecting the offer earlier this month, saying that it was better off remaining independent.
It said the deal fell through because the stock portion of Fox’s offer consisted of non-voting shares.
Fox had estimated that a combined company would save $1 bn in costs and possibly more, primarily by cutting sales staff and back-office functions.
The combined company’s revenue would be over $60bn.