In a direct challenge to the Murdoch family's control over News Corp, activist investor Starboard Value has filed an advisory shareholder resolution to dissolve the company's dual-class share structure. This latest move by Starboard, headed by Jeff Smith, comes after their previous push for News Corp to spin off its real estate businesses. Sources familiar with the matter have revealed that the Murdoch family is currently embroiled in a legal battle over the fate of their 14% stake in News Corp.

The non-binding shareholder resolution submitted by Starboard seeks to dismantle News Corp's dual-class share structure, which grants Rupert Murdoch control over approximately 40% of the company's voting stock. While Starboard only holds about 2% of the company's Class A shares, it intends to challenge the status quo and seek more equitable representation for all shareholders.

Jeff Smith, managing member of Starboard Value, emphasized the need for change within News Corp and highlighted the potential to create significant value through restructuring. Last year, Smith voiced concerns about the dual-class structure, stating, "There have been votes to declassify, it's something to consider as well. But there are easier paths to create a lot of value."

Meanwhile, Rupert Murdoch is already entangled in a legal dispute regarding the control of the family trust that holds the News Corp stake. Reports from The New York Times and The Wall Street Journal suggest that he is attempting to secure control for his son, Lachlan Murdoch. Last November, Rupert Murdoch stepped down as chair of both News Corp and Fox Corp, and Lachlan Murdoch assumed the role of sole chair at News Corp while retaining his positions as Fox Corp's executive chair and CEO.

News of Starboard's push to dissolve the dual-class share structure caused slight fluctuations in News Corp shares, dipping around 1% for the day, but subsequently experiencing modest gains. Starboard Value, known for its active campaigns at companies such as Autodesk, Match Group, and Salesforce, remains determined to bring about change in the governance of News Corp.

News Corp, in addition to being the parent company of The Wall Street Journal, owns prominent publications such as The Sun and publishing house HarperCollins. Requests for comment from both News Corp and Starboard regarding this matter are yet to be responded to.

As this battle for control unfolds, the outcome will not only impact the future direction of News Corp but also have wider implications for corporate governance and shareholder rights in the media industry.