Rupert Murdoch is facing a new threat to his family's grip on its newspaper empire, after one of the media mogul's most loyal supporters sold down most of his stake in News Corporation.

The billionaire Saudi Prince Alwaleed Bin Talal offloaded most of his 6.6 per cent shareholding, and has been left with just 1 per cent.

"The reduction of KHC's holding in News Corp has been decided in the context of a general portfolio review," the prince said in a statement posted on the website of his investment fund, Kingdom Holding Company.

"We remain firm believers in News Corp's competent management, led by CEO Robert Thomson, and are fully supportive of Rupert Murdoch and his family."

Yet the decision has raised the prospect of another shareholder revolt over the company's governance structure.

In November last year, Mr Murdoch and his supporters narrowly defeated a motion to recast News Corporation's structure at its annual general meeting in Los Angeles.

Activist investor Stephen Mayne was one of a handful of News Corp shareholders at the meeting, and voted in favour of the motion.

"It was put up by an individual shareholder, the Nathan Cummings Foundation, to try and have a more democratic structure at News Corp to get rid of the gerrymander where Rupert Murdoch controls 40 per cent of the votes but only owns about 13 per cent of stock," Mr Mayne told The World Today.

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Under the company's structure, its shares are split into two classes: class A and B.

Only class B shareholders are allowed to vote on resolutions, and that has frustrated other shareholders.

Mr Murdoch and his family are estimated to own around 40 per cent of the class B shares, and so they have the strongest voting power among News Corporation shareholders.

However, that was put at risk in LA in November.

"This resolution was supported by almost a majority of shareholders and statistically it would appear that even the Saudi prince had not voted in line with the board and Rupert Murdoch's suggestion to oppose the resolution, because the combined prince and Murdoch family holdings was actually more than the total number of votes that could have been voted on that resolution," Mr Mayne said.

"So there was quite a snafu or controversy around how the Prince voted with public denials versus the statistics."

It was regarded as controversial because Prince Alwaleed Bin Talal has long been a Murdoch family ally.

In the weeks after last year's vote, a spokesperson for the Prince's investment fund, Kingdom Holding, denied he had voted in favour of the resolution.

Stephen Mayne sees the sell-down as a potential game changer.

"Rupert now does not have any friends it seems, or any known supporters, amongst those 60 per cent shareholders, whereas traditionally he's always had his very appreciative and supportive Saudi prince voting in favour of all resolutions that he puts up historically," he said.

"There is a prospect that the rest of the shareholders could band together and try and install a more democratic approach after all these years."

News Corporation said it does not comment on the activities of its individual shareholders.

Kingdom Holding said the Prince still supports the Murdoch family and is maintaining his $US1.7 billion stake in 21st Century Fox, the company set up set up as part of demerger of News Corporation in 2013.

21st Century Fox holds gained all the more profitable film and television assets while News Corp was left with the global newspaper business.