Fox Corporation's Secondary Offering and Its Market Implications

Fox Corporation’s recent secondary offering of 16.8 million Class B shares at $54.25 per share has sparked significant debate about the interplay between ownership restructuring and liquidity dynamics in dual-class share structures. This transaction, managed by Morgan Stanley as the sole underwriter, transferred proceeds directly to the Murdoch family trusts of Prudence MacLeod, Elisabeth Murdoch, and James Murdoch, with no funds flowing to the company itself [1]. The offering marked a pivotal step in resolving the Murdoch Family Trust litigation, redistributing voting control to Lachlan Murdoch’s LGC Holdco, LLC, which now holds 36.2% of Class B shares—a class that wields 10 times the voting power of non-voting Class A shares [4].

Ownership Restructuring and Governance Control

The dual-class structure has long enabled the Murdoch family to maintain disproportionate influence over Fox Corporation. Class B shares, which carry voting rights, are concentrated among the family’s trusts, while Class A shares, held by public investors, lack voting power. This imbalance was reaffirmed in the 2024 Delaware Supreme Court ruling in In re Fox Corporation/Snap Inc. Section 242 Litigation, which upheld the validity of governance amendments approved solely by Class B shareholders [3]. The recent secondary offering, though reducing the Murdoch family’s direct ownership of Class B shares, did not dilute their voting control. Lachlan Murdoch’s trusts now hold a majority of the voting stock, ensuring continued dominance over corporate decisions [1].

The restructuring also reflects broader tensions in dual-class structures. Critics argue such arrangements prioritize founder control over shareholder interests, yet the Murdoch family’s ability to resolve internal disputes without external interference underscores the system’s resilience. As noted by Reuters, the narrow approval of similar governance changes in 2024 highlighted growing investor skepticism but failed to dismantle the family’s grip [2].

Liquidity Dynamics and Market Reactions

Secondary offerings often introduce liquidity challenges, particularly in dual-class stocks where voting rights and economic value are decoupled. The September 2025 offering saw Fox’s Class B shares dip 0.8% in after-hours trading, with trading volume surging to 2.1 million shares on September 9 [1]. While the immediate price drop may reflect short-term supply shocks from the 16.8 million-share sale, the long-term impact remains uncertain. Institutional investors, however, appear undeterred: Gotham Asset Management LLC increased its stake by 8.4%, signaling confidence in Fox’s media assets despite governance concerns [4].

The liquidity implications are further complicated by the dual-class structure. Class B shares, though fewer in number, dominate trading activity due to their voting power. Yet, the lack of detailed post-offering metrics—such as bid-ask spreads or order-book depth—limits visibility into how the secondary offering affected market efficiency [5]. Analysts at Stock Titan note that while increased supply could pressure Class B prices, the Murdoch family’s retained control may stabilize investor sentiment over time [3].

Conclusion

Fox’s secondary offering exemplifies the unique challenges and opportunities inherent in dual-class share structures. While the Murdoch family’s restructuring cements their governance control, it also tests the market’s tolerance for concentrated ownership. For investors, the key question is whether the liquidity risks associated with such structures outweigh the strategic advantages they confer to controlling shareholders. As dual-class debates intensify, Fox’s case offers a critical case study in balancing founder control with market transparency.

Source:
[1] FOX CORPORATION ANNOUNCES PRICING OF SECONDARY OFFERING OF CLASS B COMMON STOCK [https://www.prnewswire.com/news-releases/fox-corporation-announces-pricing-of-secondary-offering-of-class-b-common-stock-302549980.html]
[2] Narrow win for Fox shows restlessness with dual-class shares [https://www.reuters.com/article/business/narrow-win-for-fox-shows-restlessness-with-dual-class-shares-idUSKBN1DF1GM]
[3] Del. Supreme Court Affirms Fox/Snap Section 242 Litigation Decision [https://www.americanbar.org/groups/business_law/resources/business-law-today/2024-february/del-supreme-court-affirms-fox-snap-section-242-litigation-decision/]
[4] Fox stock falls after Murdoch family announces trust resolution and secondary offering [https://www.investing.com/news/stock-market-news/fox-stock-falls-after-murdoch-family-announces-trust-resolution-and-secondary-offering-93CH-4229987]
[5] Gotham Asset Management LLC Buys ... [https://www.marketbeat.com/instant-alerts/filing-gotham-asset-management-llc-acquires-36451-shares-of-fox-corporation-foxa-2025-09-05/]