News Corp, the giant media group founded by
billionaire Rupert Murdoch, confirmed Thursday it would split its
publishing and media business from its entertainment branch.
The company's board had approved the split in a meeting on
Wednesday, News Corp said in a statement.
"Upon closing of such a transaction, shareholders would hold
interests in a world-class publishing company, ... and an unmatched
global media and entertainment company, each of which would benefit
from enhanced strategic alignment and increased operational
flexibility with respect to an unparalleled portfolio of assets,
brands and franchises," read the statement.
The unanimous vote was held after an hour-long meeting in New
York, which included contributions from the group's chairman and
chief executive, Murdoch, as well as financial advisers, a person
present was quoted as saying by the Wall Street Journal, which is
owned by News Corp.
The group's more profitable entertainment businesses, including
20th Century Fox and the Fox broadcasting companies, would make up
one company.
The other would house the group's numerous newspapers including
the Times of London and other titles in the United States, Britain
and Australia, as well as book publisher HarperCollins and several
education companies, the report said.
"Our board and I believe that this new corporate structure we are
pursuing would accelerate News Corporation's businesses to grow to
new heights, and enable each company and its divisions to recognize
their full potential - and unlock even greater long-term shareholder
value," said Murdoch in the company's statement.
Investors welcomed the news, which would isolate the entertainment
branch from the shrinking incomes affecting the publishing sector as
a whole. Shares in News Corp jumped 11 per cent between news of the
plan emerging Tuesday and the close of trading Wednesday.
The film and broadcasting companies might also find it easier to
do business if they put some distance between themselves and the
phone-hacking allegations facing the group's print media in Britain,
the Wall Street Journal report quoted observers as saying.
