News Corp will purchase 9.9% of Rotana shares, Rotana board chairman Saudi Prince Alwaleed Bin Talal announced on Tuesday (February 23rd).
Under the agreement, News Corp will buy $70 million worth of newly issued shares of Rotana, while retaining the right to double its shares to 18.18% during the 18 months after the transaction is completed.
The deal enhances the presence of News Corp in the Arab region and expands Rotana's access to other parts of the world.
The announcement came during a press conference at the offices of Kingdom Holding Company in Riyadh
The Kingdom Holding Company has owned almost 7% of News Corp's Series B Ordinary shares since 2005.
"We are pleased with this alliance with News Corp, as it is one of the largest companies in global media," said Prince Alwaleed. "It is a company with a track record at the global level. And this investment will strengthen this alliance and will support Rotana's strong place in the region and widen its access to Arabs in all parts of the world."
"Our investment in Rotana will expand our presence in the region, which has a young and growing population and where GDP growth is set to outstrip that of more developed economies in the years ahead," Murdoch said.
"Rotana is a leading player in the Middle East and we look forward to working together," he added.
The alliance followed a series of meetings between the parties, including a visit by Murdoch to Riyadh
The Riyadh
After signing an agreement with Rotana and the Walt Disney Company for Europe, the Middle East, and Africa, Fox International Channels announced the addition of the Fox Series Channel to viewers in the Middle East and North Africa in 2009.
Rotana has the largest collection of Arab films and is the leading Arabic music production company with the largest collection of Arabic songs. It also has a television network and a radio network currently under expansion.
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