Wed, Jun 27, 2012 - Page 15 News List

News Corp mulls split:WSJ report

WARMING TO IT:Sources said Rupert Murdoch was slowly getting used to the idea of spinning off the media conglomerate’s film and television businesses

AFP, SYDNEY

Australian stock in Rupert Murdoch’s News Corp jumped 2.41 percent yesterday after a report that the company might be split in half, separating its publishing assets from its bigger entertainment arm.

Its Australian-listed shares closed A$0.49 higher at A$20.79, having risen as high as A$21 on the Wall Street Journal report.

The Murdoch-owned newspaper said the split would carve off the film and television businesses, including 20th Century Fox movie studio, Fox broadcast network and Fox News channel from its newspapers and book publishing assets.

The company’s publishing assets include the Wall Street Journal, the Times of London and the Australian newspaper, as well as the HarperCollins book publishing house.

Citing people familiar with the situation, the report said a final decision had yet to be made, but Murdoch was warming to the idea.

It said such a plan was not expected to change the Murdoch clan’s effective control of any of the businesses, exercised through the family’s roughly 40 percent voting stake in News Corp.

The possible restructuring follows the phone-hacking scandal in Britain, which resulted in the closure of its flagship News of the World tabloid and the resignation of several senior executives.

In March, News Corp president Chase Carey, seen as Murdoch’s likely successor, said that some shareholders had talked to the company about spinning off the newspaper arm, but added that it was “not a path we are pursuing.”

“I think part of it is a general fad. Every time you have a [diversified] business, some in the investment community are looking to split it up,” Chase said in an interview with News Corp-owned newspaper the Australian.

“But our plan is to drive the business forward, and we have great and unique businesses and our focus is improving the profitability of those businesses,” he said.

Murdoch personally has remained a big fan of the newspaper business, having built his global empire from Australia’s Adelaide News in the 1950s.

Last week, his Australian arm, News Limited, announced a major restructure to streamline operations, merging its print and digital businesses with significant redundancies, though it did not specify the number.

It also made a A$2 billion (US$2 billion) takeover offer for rival Australian tycoon James Packer’s Consolidated Media Holdings.

If successful, News Limited would emerge with 50 percent of Foxtel, the country’s biggest pay TV operator, and all of Fox Sports. Telecommunications giant Telstra holds the other half of Foxtel.

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