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Rupert Murdochs 21st Century Fox Inc. decided to drop its unsolicited $80 billion acquisition bid for Time Warner Inc, a deal that was considered able to reshape the media industry. 21st Century Foxs board decided instead to authorize a $6 billion repurchase of its Class A shares.

Mr. Rupert Murdoch, officially announced yesterday that the company withdrew the offer after the board of Time Warner Inc. declined to engage in negotiations. In addition, the stock price of Time Warner Inc. fell by 11% since the bid of Murdochs company became public.

Mr. Murdoch said in a statement, which was cited by Bloomberg: “Time Warner management and its board refused to engage with us to explore an offer which was highly compelling. Additionally, the reaction in our share price since our proposal was made undervalues our stock and makes the transaction unattractive to Fox shareholders.”

Time Warner Inc. rejected the bid of Mr. Murdochs company describing it as too low. It also said that it has a growth plan that is expected to generate more value than any proposal Fox “is in a position to offer”.

The announcement of the withdrawn bid was unexpected for some analysts, who have been observing Foxs business decisions for a long time. On the other hand, the Chief Executive Officer of Time Warner Inc. – Mr. Jeff Bewkes, has never declared an intention to sell the company.

21st Century Fox Inc. made its offer to Time Warner in July this year. The company offered to pay a price of $80 billion for Mr. Bewkes company, which is about 84 dollars per share in cash and stock. The deal would have been the largest one in the media industry since the $162-billion acquisition of AOL by Time Warner in 2000.

Shares of Twenty-First Century Fox Inc. rose as much as 11% to $34.71 in late trading yesterday. In regular trading before the announcement, they fell 0.70% to close at $31.30 per share yesterday, marking a one-year change of -0.19%. According to the information published on CNN Money, the 19 analysts offering 12-month price forecasts for Twenty-First Century Fox Inc. have a median target of $40.00, with a high estimate of $46.00 and a low estimate of $29.00. The median estimate represents a +27.80% increase from the last price of $31.30.

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