Murdoch's global behemoth launched the overnight raid on Australia's second largest newspaper publisher two days after the passage of landmark reform laws that are already transforming the media landscape.
But News Corp denied the move is not a precursor to a full takeover of the publisher of flagship newspapers The Sydney Morning Herald, The Age and The Australian Financial Review as well as a stable of online assets.
"It is true; it is purely an investment and is entirely friendly to the existing Fairfax board," News Corp spokesman Andrew Butcher said.
"There's nothing more to it than that," he told the Australian Associated Press from New York.
News Corp owns such newspapers as The Times of London, The Sun tabloid, the New York Post, The Australian as well as cable television network Fox and direct broadcast satellite systems DirecTV and BSkyB.
Fairfax has been at the centre of frenzied speculation over its possible acquisition after parliament voted in new laws on Wednesday easing media cross ownership rules.
"News Corporation has confirmed to Fairfax its acquisition of 7.5 percent of the company," Fairfax said in a statement published in its Age newspaper.
"Fairfax notes News Corp's statement that the acquisition is an investment and friendly to the existing board. There is every reason for investors to see value in Fairfax and its future," the company added.
Media analysts said the move was a strategic manoeuvre to prevent other companies taking control of Fairfax as a wave of media takeovers and mergers gets underway in earnest when the news laws come into force, expected early next year.
Media and gaming giant Publishing and Broadcasting Ltd -- headed by James Packer -- announced Wednesday it was selling half its media assets to a Hong Kong-based venture capital firm for $A4.5 billion dollars.
The sudden cash boost to PBL immediately focused attention on Fairfax amid speculation that it was a likely target of a PBL acquisition.