News Corp spin-off will include stock buyback fund, poison pill

News Corp, the giant media entertainment and media conglomerate, announced new details on Friday about its long-awaited plans to spin-off its newspaper and publishing businesses into a separate corporation.

The split will officially take place on June 28 and will include a $500 million stock buyback fund, which will be used to purchase shares “on an opportunistic basis following the completion of the separation.”

The company also announced what investors call a poison pill in the form of provisions that allows existing shareholders to purchase $180 worth of stock for $90 in the new News Corp if any new investor should acquire 15% of the company.

There is a similar provision for 21st Century Fox, which is the new corporate name for the entertainment and cable assets which will remain after after the spin-off. The provisions, which will be in force for one year , appear to be intended to thwart hostile takeovers:

The rights agreements are intended to protect the stockholders of the Company and the new News Corporation from efforts to obtain control of such companies that their respective Boards of Directors determine are not in the best interests of the companies and their respective stockholders.

News Corporation decided to split in two last year under pressure from investors who believe the publishing assets and related scandals associated with phone hacking were a drag on the company.