News Corp Considers Splitting Into Two: Report
Australian stock in Rupert Murdoch’s News Corp. jumped 2.41 percent Tuesday after a report that the company may be split in half, separating its publishing assets from its bigger entertainment arm.
Its Australian-listed shares closed 49 cents higher at Aus$20.79, having risen as high as Aus$21.00 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.
News’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 family’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.
Last month, News Corp. reported a strong gain in quarterly profits, boosted by Hollywood entertainment and cable television operations in the United States, Asia and Latin America.
The conglomerate said profits in the fiscal third quarter ended March 31 leapt 47 percent to $937 million, as revenues rose two percent to US$8.4 billion.