In the final season of “Succession,” the HBO drama about a fictional media clan, the show’s grisly patriarch, Logan Roy, dishes out some characteristically choice words to his privileged children: “I love you, but you are not serious people.”
The real-life media billionaire Rupert Murdoch appeared to share similar sentiments, a recent ruling revealed, as he tried to wrestle power from three of his offspring: “I love each of my children,” he said, reading from a statement during a trust meeting. “But these companies need a designated leader and Lachlan is that leader.” Lachlan Murdoch, one assumes, in his father’s mind, is the most serious.
Art imitating life or life imitating art — it gets confusing when it comes to the nonfiction drama being played out by the Murdochs. In last weekend’s ruling on Mr. Murdoch’s failed attempt to change his family trust, one representative was roundly criticized for knowing so little about the Murdochs that he watched “Succession” to brush up. A separate rep, it emerged, took inspiration from the show to draw up a “‘Succession’ memo” on how to navigate the family empire when the now 93-year-old patriarch dies.
Avid “Succession” viewers know how well that turned out for the Roy family. After Logan’s death on a private jet, his wishes were impossible to interpret. (Was that name underlined or crossed out?) In the ensuing power vacuum, his children failed miserably, unable to form any meaningful alliances, and ultimately lost control of the family empire.
So what does the future hold for the Murdochs?
Mr. Murdoch was disappointed that his “objector” children, as they were described in the court proceedings, pushed back when he attempted to change his family trust to cement his eldest son, Lachlan, in control, with the aim of bulletproofing the conservative bent of his media empire. The senior Murdoch seemed to feel that his children should simply respect his wishes for what happens to his empire, and his wealth, when he dies. That included giving up their equal control in the family trust.
The Murdoch heirs are already beyond wealthy, to the tune of $2 billion each, from the sale of the family’s 21st Century Fox assets to Disney. That’s to say nothing of previous multimillion-dollar payments they have received.
But unlike most family trust battles, this is less about money and more about power, politics and ruffled feathers. Mr. Murdoch misjudged the reaction of his two eldest daughters in particular, apparently thinking they would fall in line with his plan, ironically called “Project Family Harmony.” Instead, feeling hoodwinked, they joined ranks with their renegade brother, James, who is hardly on speaking terms with his father, to fight the changes and keep their equal status on the trust.
In his binge viewing of “Succession,” Murdoch Sr.’s new unnamed representative may have spotted that such allegiances are easy to form and quick to crumble. No sooner are the Roy children bonding over a new “Substack meets MasterClass meets The Economist meets The New Yorker” media venture than they’re splintering again as the ultimate prize, their family business, Waystar Royco, dangles tantalizingly before them.
As it currently stands, Mr. Murdoch is guaranteed control of the family trust in his lifetime. When he dies, his votes will disappear and the four children — Prudence, Lachlan, James and Elisabeth — will be left with one vote each. The trust is the biggest shareholder of Fox Corp. and News Corp., which owns, among other things, the HarperCollins book business and The Wall Street Journal, meaning the four children will have considerable sway over those companies.
Having four constantly shifting, politically divergent voices on the trust looks like a recipe for disaster. How would that work? Decisions would need three votes to pass, and the foursome doesn’t get along at the best of times. How would the underlying businesses, with a combined market capitalization of around $40 billion, have an ordinary dialogue with their top shareholder when they’re controlled by a four-headed hydra?
This was a point not lost in Mr. Murdoch’s legal arguments as he tried to prove that consolidation of control of the trust into Lachlan’s hands would be in the interests of all beneficiaries. Then again, the “irrevocable” in “irrevocable trust” has to mean something. The current construct may not be future-proof, but Mr. Murdoch himself created it 25 years ago. Either he optimistically assumed his children would have groupthink after his passing or cynically assumed he would figure out a way to sort it out later — presumably, when one of his children proved to be the most serious.
The attorney for Rupert and Lachlan has said they will appeal, no doubt hoping a new, learned friend among the judiciary will view the situation differently. It’s hard to see how they can come back from such a damning ruling, which criticized their plan as a “carefully crafted charade,” unless they have a different line of attack.
This is not the first time the Murdoch family trust has been a source of melodrama. As a condition of his divorce from his second wife, Anna, Mr. Murdoch agreed to give his four eldest children equal voting rights on the trust to protect their inheritance. Then came two new siblings from Mr. Murdoch’s marriage to Wendi Deng, bringing more change as they were inserted into the trust. (They became financial beneficiaries only)
What seems to have sparked this latest blowup was Rupert and Lachlan’s concern that James Murdoch, labeled the “troublesome beneficiary” in the case, would lead a charge to oust his older brother and shift the news properties to the center, something their father considers financially ruinous. During the case, the objector children disavowed that they had any such plan. And in a joint statement after the ruling, the three said they would focus on “rebuilding relationships among all family members.”
Still, Lachlan is likely to continue to see James as a threat. The brothers have long been at odds after clashing over Fox News when they shared operating responsibility. James was ultimately passed over in favor of Lachlan, and he left the family business in 2020.
That leads us to Lachlan’s next option: buying out his brother, and potentially the other two siblings, from the trust. This has been explored before and ditched, given the enormous price tag, but it would be the cleanest way forward.
It would cost Lachlan more than $3.5 billion to buy out his three siblings, according to one estimate. He could use his spoils from the sale to Disney to help fund the acquisition, but that is a sizable ticket, even by Murdoch standards, and would likely involve taking on considerable debt. The three siblings would surely still push hard for a fat control premium, and several of the assets are in declining industries. A buyout would also raise questions about the fate of the patriarch’s two youngest daughters in the trust.
If the Murdochs need a term sheet for the buyout, there’s one in the expletive-inscribed birthday card that Logan Roy sent his son Kendall in “Succession” season three, episode seven.
Waiting for the trust case to wind through the appeal process feels too pedestrian for the Murdochs. Resolving Mr. Murdoch’s legacy is a priority, and deal making is in his blood. He may want to take advantage of the incoming Trump administration and sell out completely to a sympathetic buyer. This, surely, would be Lachlan’s least favored route, but it could net a giant pile of cash for everyone. Logan Roy tried to do the same when he negotiated the sale of his empire to a nihilistic Nordic tech baron (it could just as easily have been a South African one).
Whether it is another round of legal shenanigans, a buyout, a sale or a new deal altogether, it will take time — and time may not be Mr. Murdoch’s friend. While he’s newly married, and no doubt full of the youthful fervor that comes with that, my one piece of advice would be not to travel by private jet.
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