The New York company said Wednesday that Twenty-First Century Fox Inc. offered last month a combination of its stock and $32.42 in cash for each Time Warner share.
Time Warner's board rejected the bid after consulting with financial and legal advisers and determining that its strategic plan "will create significantly more value for the (company) and its stockholders and is superior to any proposal that Twenty-First Century Fox is in a position to offer," the company said.
Time Warner also said a combination with Twenty-First Century Fox carried considerable strategic, operational and regulatory risks. It also saw risk and uncertainty in the valuation of Twenty-First Century Fox's non-voting stock and that company's ability to handle a combination of this size and scale.
The New York Times reported that the bid totaled $85 per share or $80 billion.
Twenty-First Century Fox confirmed in a short, separate statement that Time Warner had rejected its bid, but it did not provide any details. It added that it is not currently in discussions with Time Warner.
The Times, citing anonymous sources, said that Murdoch is determined to make a deal. That price amounted to a 25 premium to Time Warner's stock price at the time.
Time Warner's holdings include the cable movie channel HBO and Warner Bros. studios. The company said Wednesday its management team has completed several deals that have unlocked value in related businesses.
It spun off Time Warner Cable into a separate company in 2009. Last month, it completed the spin of its publishing division Time Inc. as well.
The Times reported that Twenty-First Century Fox would have sold CNN as part of the deal to avoid anti-trust concerns. Its Fox News competes directly with the news network.
Shares of Time Warner jumped 16 percent, or $11.49 to $82.50 shortly before markets opened Wednesday while Twenty-First Century Fox climbed 6 cents to $35.25.