Jan. 10 (Bloomberg) -- The pension fund for workers in Australia’s pulp and paper industry sold its stake in the country’s largest publisher News Corp., saying the company controlled by Rupert Murdoch needs a more independent board.
First Super, which invests about A$1.7 billion ($1.8 billion) for about 72,000 members in the country’s timber, pulp, paper, and furniture industries, said it was selling the stake after the failure of a push at the company’s annual shareholder meeting for an independent chairman and more independent directors.
Murdoch is News Corp.’s chairman and chief executive and has the largest voting stake in the company, with about 40 percent of Class B shares. That control, combined with a 7 percent voting stake held by Prince Alwaleed bin Talal, a friend of the Murdoch family, makes it difficult to enact changes to the board, an arrangement criticized at News’s annual shareholder meeting in October.
“The interests of minority shareholders have too often been compromised,” Michael O’Connor, co-chairman of the fund, said in the statement. Executives of News Corp. were paid “outrageous amounts of money,” he said.
News Corp. shares traded in Sydney rose 1 percent to A$25.745 as of 2:35 p.m., compared with a 0.3 percent gain in the S&P/ASX 200 index.
The shares sold by First Super are worth about A$7 million, Phil Davey, an external spokesman for the fund at Mountain Media Pty., said by phone. That’s about 0.01 percent of News Corp.’s A$60 billion market value.
Investors who favor splitting the chairman and chief executive roles include the California Public Employees’ Retirement System, the biggest U.S. pension fund. Bloomberg LP, the parent of Bloomberg News, competes with News Corp. units as a supplier of financial information.
Stephen Browning, a spokesman for News Corp.’s Australian publishing unit News Ltd., said he wasn’t able to comment on group issues. Julie Henderson and Nathaniel Brown, New York-based spokesmen for News Corp., didn’t immediately respond to an e-mail sent out of office hours requesting comment.
To contact the reporter on this story: David Fickling in Sydney at firstname.lastname@example.org
To contact the editor responsible for this story: Michael Tighe at email@example.com