One of Rupert Murdoch's key business allies, who was arrested in last week's corruption crackdown in Saudi Arabia, has quietly sold off his $1.5 billion stake in 21st Century Fox.

Key points: For the first three quarters of 2017, the Prince, a huge backer of Murdoch, owned 39,737,915 shares

For the first three quarters of 2017, the Prince, a huge backer of Murdoch, owned 39,737,915 shares That went down to zero in the fourth quarter

That went down to zero in the fourth quarter The shares' new owners remain unknown at this stage

The business relationship between Mr Murdoch and Prince Alwaleed bin Talal is now under new scrutiny, with Mr Murdoch's control over his family-controlled business empire looking more uncertain.

"This is very big news," Murdoch watcher and shareholder activist Stephen Mayne said after the company confirmed Prince Alwaleed had offloaded his shareholdings in Fox and News Corporation.

"He's been the number one backer of Murdoch family control of the public companies for the last 20 years."

One of the world's richest men, the Prince is one of dozens of royal family members, officials and business leaders arrested in Saudi Arabia in recent days.

With his bank accounts and other assets likely to have been frozen by Saudi authorities, his detention had raised questions about who had control over his almost 40 million Fox shares.

It now appears he sold those shares with little fanfare.

It is unclear when the shares were sold.

But a Bloomberg report on the company's shareholders shows Prince Alwaleed's stake fell to zero during the current financial quarter.

What happens to Murdoch's control now?

"The last we knew from all the public disclosures was that he still held a key 5 per cent voting stake worth about a $US1 billion," Mr Mayne said.

"If he's now sold out $US1 billion, then control of 21st Century Fox is less certain going forward."

The revelation comes just days ahead of the company's Annual General Meeting, scheduled to be held next week.

The AGM will be asked to vote on a hostile shareholder resolution to get rid of the company's dual class voting structure, where almost 70 per cent of the shares on issue don't get a vote.

Similar resolutions have previously been supported by 30 to 40 per cent of the total shares on issue, close to a very significant majority of the non-Murdoch shares.

"Each time the Prince has been a key backer of [the Murdochs]," Mr Mayne said.

"So if those shares are now gone and they are held by normal institutional investors, then the protest vote is likely to be larger than usual at next Thursday's annual meeting."

Friend or foe? We'll soon know

At this stage it's not known who the Prince sold his shares to, and whether the new owners are on the Murdochs' side.

"If they've gone into the open market then it is more likely that the shares would be hostile to the poor governance arrangements at News Corp with the undemocratic voting structure, but we just don't know," Mr Mayne said.

"The Prince ... may have arranged to sell the shares to another supportive shareholder.

"That will probably become clearer after we see the voting results and the debate from Fox Studios in Los Angeles next Thursday."

But Mr Mayne believes the Prince might still retain voting rights at the company's AGM.

The deadline for proxy vote arrangements was back in September.

"The record date for the annual meeting is September 18 which is a few weeks ago," Mr Mayne said.

"So if the Prince sold out after September 18, he will still have control of those votes and he could cast them again in favour of Murdoch control for one last time.

"But if he sold them after September 18, then they could have fallen into hostile hands and they could join the protest vote which is expected at next week's AGM.

"That will become apparent when we actually see the voting results next week."