Rupert Murdoch’s six children could each receive as much as $2bn (£1.5bn) from the sale of his 21st Century Fox global entertainment empire to Disney.
Murdoch is in the final stages of completing the $71.3bn sale of 21st Century Fox, which includes the Hollywood studio behind hits from Deadpool to X-Men and a 39% stake in Sky. The family trust, which the 87-year old Murdoch controls, owns a 17% stake in Fox worth a little over $12bn.
The beneficiaries of the trust, in which Murdoch has no financial interest, are his children Prudence, James, Lachlan and Elisabeth. Grace and Chloe, his daughters with his former wife Wendi Deng Murdoch, whom he divorced five years ago, are also beneficiaries but have no voting interest in it.
The $12bn figure, first reported by the Financial Times, is the maximum theoretical windfall Murdoch’s children could receive.
There are, however, likely to be multibillion pound tax implications associated with the deal. Disney’s offer to Fox shareholders was made as a split of cash and shares and the former is taxable.
Tax experts believe Murdoch would end up having to accept a “roughly”50/50 mix between cash and Disney shares for the family trust’s holding. This would mean a bill of up to $2bn and more like a $10bn windfall for the trust and its beneficiaries.
The Disney deal includes Fox’s interest in Sky, which Disney agreed to sell to Comcast after it won a £30bn auction for the pan-European pay-TV company last month.
It does not, however, include the Murdoch family’s stake in News Corp, the owner of newspapers including the Sun, the Times and the Wall Street Journal, or its holding in New Fox, the new parent company for assets not included in the Disney deal such as the Fox News channel and Fox TV network, which is worth billions of dollars. The spin-off also involves multibillion dollar tax implications.
Murdoch and his eldest son, Lachlan, are to continue to work side by side following the Fox sell-off, with Lachlan chairman and chief executive of New Fox and Murdoch co-chairman.
The youngest son, James, currently 21st Century Fox’s chief executive, had been tipped for a potential role at Disney following completion of the deal but is instead striking out on his own.
He has also been tipped to take over as chairman of Tesla, where he is an independent director, when Elon Musk steps down next month.