News Corp said on Thursday its board had approved a plan to split the company into two entities, and that Rupert Murdoch will remain as chief executive of its new, separate entertainment company.
The company will split the $60-billion media conglomerate into publicly traded publishing and entertainment companies, with Murdoch as chairman of both, and his family retaining control. It didn't name an executive to lead the new publishing business.
News Corp Chief Operating Officer Chase Carey will remain in that role in the new entertainment business.
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News Corp's board, overseen by the 81-year-old Murdoch, met on Wednesday and authorized management to move ahead with the separation, the company said.
The entertainment company will include News Corp's Fox broadcasting and cable networks, 20th Century Fox movie studios and pay-TV businesses in Europe and India.
The publishing company will include newspapers like the Wall Street Journal and The Sun, book publisher Harper Collins, an integrated marketing business as well as its fledgling digital education division.
Analysts and investors have been skeptical about whether the struggling publishing business would be able to prosper as a standalone. Murdoch addressed these concerns in a memo Thursday to his staff, which was obtained by Reuters.
"Our publishing businesses are greatly undervalued by the skeptics. Through this transformation we will unleash their real potential," said Murdoch.
There has been mounting pressure on News Corp to get rid of its newspaper business after a phone-hacking scandal tainted its British titles and forced the company to drop its proposed acquisition of pay-TV group BSkyB.