July 25, 2011 / 2:50 AM / 9 years ago

Saudi billionaire backs News Corp structure: report

LONDON (Reuters) - News Corp’s major shareholder Prince Alwaleed bin Tala has rebuffed calls to change the company’s dual-class structure or leadership, the Financial Times reported in its Tuesday edition.

Prime Minister David Cameron, flanked by Deputy Prime Minister Nick Clegg (L), speaks about phone hacking to parliament in a still image taken from video in London, July 20, 2011. REUTERS/Parbul TV via Reuters TV

“Investors went into News Corp knowing the class A and B share structure,” Alwaleed was quoted as saying in an interview with the newspaper. “No one can cry wolf now.”

The Saudi billionaire owns the same class B voting shares as the Murdoch family, who use the structure to command almost 40 percent of the voting rights with a 12 percent share stake. Class A shares do not have voting rights, the FT reported.

News Corp is embroiled in a phone-hacking scandal that has led to closure of the 168-year-old News of the World.

Alwaleed reiterated his support for the way Rupert and James Murdoch handled the phone-hacking crisis. Both Murdochs testified before parliament’s media committee on July 19.

“Unfortunately the incident gave weapons to competitors who created a hysteria,” he said.

“What took place was wrong, but the media over leveraged this” and created an environment in which News Corp had to abandon its bid for full control of BSkyB, he said.

“We need stronger rules in place to ensure that no unethical incidents happen again in any News Corp entities,” Alwaleed was quoted as saying.

According to the report, he dismissed suggestions that News Corp shares might suffer from a “Murdoch discount” as a result of family control, attributing what he described as currently depressed values to generally lackluster results in the newspaper industry.

On July 20, Alwaleed told Reuters that he did not plan to sell any of his shares in News Corp.

Reporting by Brenda Goh

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