Rupert Murdoch resigned from a number of News Corp. boards—including his post as director of News International, the holding company for the newspapers at the center of the U.K. hacking scandal—as the company prepares to divest its publishing and entertainment properties, according to an internal memo cited by Reuters.
After the split, which was approved by News Corp.’s board on June 27, Murdoch will remain chairman of both companies as well as CEO of the new entertainment company. The group's film and television assets account for three-quarters of News Corp.'s revenue and almost all operating profit.
The hacking scandal reportedly increased investor pressure on the company to cordon off its publishing arm. News Corp. hasn't said who would be CEO of the new publishing company, whose businesses will include The Wall Street Journal as well as the company's U.K. and Australian newspapers.
The split would make one entity of News Corp.'s film and TV businesses, including the Fox movie studio, Fox broadcast network, Fox News Channel and FX cable networks and others, according to The Hollywood Reporter. The company's newspapers, HarperCollins and education businesses would become another. The latter would have much smaller revenue and operating profit. Although News Corp. claims that the split would increase the value of both its publishing and entertainment divisions, critics say that removing the money-losing newspapers might only benefit the media side, and others have questioned whether films and shows could suffer from a synergistic split.
News Corp. didn't immediately return a call for comment.