Board agrees to News Corp split; Murdoch still in charge

NEW YORK | LOS ANGELES| LONDON: News Corp, the media company controlled by Rupert Murdoch, said it plans to split into two publicly-traded entities after its board approved the move separating publishing assets from entertainment businesses.

The publishing business consists of newspapers in the US, the UK and Australia, as well as book, education and marketing assets, according to a statement from the company on Thursday. The media and entertainment company includes film and TV assets. Murdoch will be chairman of both companies and chief executive officer of the media business when the deal is completed in about 12 months.

With the action, Murdoch, 81, is bowing to shareholder demands after a costly year-long scandal at his treasured newspaper operation, which is seen as a drag on the larger and growing film, broadcast and pay-television units. The phone-hacking probe at the UK newspapers has led to arrests and parliamentary hearings, costing News Corp millions.

"Rupert realised he'll be able to unlock the most value for the company by doing this," said David Bank, a New York-based analyst with RBC Capital Markets.