Report: Chase Carey May Replace Rupert Murdoch as News Corp. CEO (Updated)

Mon Jul 18, 2011 5:56pm EDT

The board of News Corporation is considering replacing Rupert Murdoch with Chase Carey as CEO of News Corporation, according to Bloomberg.

But a senior News Corp. official told TheWrap there was no meeting on Monday discussing elevating Carey to CEO. The official said there was a succession plan in place, but no intention to accelerate it.

Citing three individuals who were not authorized to speak publicly, the financial service said independent board directors were concerned about "the quality and quantity" of information they've received about the phone hacking scandal that has rocked the media giant over the past two weeks. 

The directors and some News Corp. executives were also reportedly concerned at Murdoch's performance during rehearsals on Monday for his Parliamentary appearance.

According to Bloomberg, independent directors on the board discussed the change on Monday. Murdoch would remain chairman. Carey has been the COO of the company since 2009.

Murdoch is scheduled to speak before British Parliament on Tuesday and answer questions about the phone hacking scandal.

Carey is one of the few executives at the top of News Corp. who has had no connection with the phone hacking scandal.

Carey first joined Fox in 1988 and went  on to become COO of Fox, Inc and CEO of Fox Broadcasting. He was once co-COO of News Corp. with Peter Chernin, and then left to become CEO of DirecTV, a company in which News Corp. once held an interest.

News Corp.’s independent directors hold nine of 16 board seats at the company. They are led by Roderick Eddington, the former CEO of British Airways.

The replacement of Murdoch, if it were to come to pass, would be a stunningly swift and humiliating exit for the media titan, who has long presided over one of the most powerful global companies in the world.

Murdoch had anticipated that one of his children would eventually run News Corp. But his heir apparent, James, has been deeply embroiled in the scandal that has escalated to claim 10 arrests so far and a half-dozen resignations of senior executives.

Carey would be seen as an ideal transition candidate, known as both capable and knowledgeable about News Corp., but loyal to the Murdoch family. The family controls 39.7 percent of the voting stock of the company.

In other developments on Monday, corporate ratings firm Standard & Poor's said that it was putting Rupert Murdoch's News Corp. on its "CreditWatch" list, which could result in a possible credit downgrade.

“The U.K. legal process has expanded and pressure from U.S. lawmakers has increased for an FBI probe” of possible phone hacking in the U.S., S&P said in a statement.

News Corp. shares fell further on Monday to close at $14.97 a share. That is a 17% decline since July 5 when the scandal began. (See chart from Yahoo.)

Follow TheWrap for full coverage of Murdoch's testimony in Parliament on Tuesday.

The independent directors include:

Tom Perkins (Partner at Kleiner, Perkins, Caufield & Byers);

Jose Maria Aznar (former President of Spain);

Viet Dinh (Law Professor at Georgetown University);

Kenneth E. Crowley (Chairman of R.M. Williams Holdings);

John L. Thornton (Professor and Director of Global leadership at Tsinghua University of Beijing);

Stanley S. Shuman (Managing Director of Allen & Company LLC);

Peter Barnes (Chairman of Ansell Limited);

Andrew S.B. Knight (Chairman of J. Rothschild Capital Management Ltd);

Roderick Eddington (Non-Executive Chairman for Australia and New Zealand at J.P. Morgan).

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