London - News Corp said on Thursday its board had approved a
plan to split the company into two entities, and that Rupert Murdoch will
remain as chief executive of its new, separate entertainment company.
The company will split the $60bn media conglomerate into
publicly traded publishing and entertainment companies, with Murdoch as
chairman of both, and his family retaining control. It didn’t name an executive
to lead the new publishing business.
News Corp Chief Operating Officer Chase Carey will remain
in that role in the new entertainment
News Corp's board, overseen by the 81-year-old Murdoch, met
on Wednesday and authorised management to move ahead with the separation, the
The entertainment company will include News Corp’s Fox broadcasting
and cable networks, 20th Century Fox movie studios and pay-TV businesses in
Europe and India.
The publishing company will include newspapers like the Wall
Street Journal and The Sun, book publisher Harper Collins, an integrated
marketing business as well as its fledgling digital education division.
Analysts and investors have been skeptical about whether the
struggling publishing business would be able to prosper as a standalone.
Murdoch addressed these concerns in a memo Thursday to his staff, which was
obtained by Reuters.
"Our publishing businesses are greatly undervalued by the
skeptics. Through this transformation we
will unleash their real potential," said Murdoch.
There has been mounting pressure on News Corp to get rid of
its newspaper business after a phone-hacking scandal tainted its British titles
and forced the company to drop its proposed acquisition of pay-TV group BSkyB.