In a follow-up to its recent decision to split into two
separate publicly traded entities,
) named Robert Thomson, Editor-in-Chief of Dow Jones and managing
The Wall Street Journal,
as the new CEO of its publishing company.
News Corporation hit the headlines in June, when it proclaimed
its decision to split into two separate publicly traded
publishing and media and entertainment entities. There has been
immense pressure from shareholders to divest the publishing arm,
which has been grappling with lower operating profit compared
with the entertainment unit.
The Publishing Company (to be known as News Corporation) will
comprise publishing businesses, education unit and the integrated
marketing services business. On the other hand, Entertainment
Company (to be named as Fox group) will encompass cable and
television assets, filmed entertainment, and direct satellite
The company announced Rupert Murdoch as the Chairman of the
publishing entity as well as the Chairman and CEO of the
entertainment company. Alongside, the company named Chase Carey
as the president and COO of the new entertainment company, while
James Murdoch will continue as the deputy COO.
The split is expected to augur well for News Corporation,
which has been in troubled waters since the revelation of the
phone hacking scandal that eventually led to the closure of the
publication of 'The News of the World'. Moreover, the company was
held back from acquiring the remaining 61% stake in the British
Sky Broadcasting Group.
Currently, we have a long-term 'Neutral' recommendation on the
stock. Moreover, News Corporation, which competes with
Time Warner Inc.
), holds a Zacks #3 Rank that translates into a short-term 'Hold'
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