TEXT-Fitch rates News America Inc bonds offering 'BBB+'

Sept 11 - Fitch Ratings has assigned a 'BBB+' rating to the 10-year senior
unsecured benchmark note offering by News America Incorporated (NAI), a
subsidiary of News Corporation (News Corp.) The Rating Outlook is Stable. A full
list of ratings follows at the end of this release.

Proceeds of the new issue are expected to be used for general corporate
purposes, including refinancing near-term maturities. The new notes will rank
pari passu with other senior unsecured indebtedness of NAI, and will also
benefit from a guarantee by News Corp. Similar to notes issued in recent years,
the notes will contain an obligation by News Corp. to repurchase the notes at
101% upon change of control (including a transfer of more than 50% of the
company's voting stock to a person other than News Corp. or a member of the
Murdoch family) and non-investment grade ratings, as defined. Similar to
existing bonds, there are no financial covenants.

News Corp. has significant flexibility at its current ratings, given the
strength of its remaining underlying businesses, leverage metrics below Fitch's
3x target and strong liquidity and free cash flow. Fitch continues to believe
that pro forma for the announced separation of its publishing businesses, the
remaining company (i.e., the media & entertainment businesses) will be solidly
within Fitch's parameters for 'BBB+' ratings.

Fitch estimates that leverage at June 30, 2012 was 2.2x, and that this
transaction will increase it to 2.4x (assuming $1 billion of issuance). Fitch
believes that the publishing separation will increase leverage approximately
0.5x. Therefore, leverage should remain at or below 3.0x. Fitch expects News
Corp. to maintain similar financial policies post the separation, including
leverage of 2.0 - 2.5x and a large cash cushion. Indications of a shift in
financial policy could result in negative ratings actions.

The capitalization of the publishing spinoff (likely at least $1 - 2 billion),
as well as the expected $4.7 billion of share repurchases over the next 12
months, will be manageable within News Corp.'s ratings and liquidity profile. At
June 30, 2012, News Corp. had $9.6 billion of cash on hand, an undrawn $2.0
billion RCF maturing May 2017, and annual FCF generation of $2.5 - $3.0 billion
post separation. The proposed issuance will also boost News Corp.'s liquidity
profile. Near-term maturities are minimal, with only $273 million of debentures
due in Feb. 2013.

The transaction will result in an improved operating profile at News Corp.,
given the divestiture of the company's lowest-margin, most capital intensive,
and secularly challenged business. It will result in only moderately lower FCF,
as the publishing segment generates approximately 15% of consolidated EBITDA and
one-third of consolidated capital expenditures.

Fitch notes that post spin, News Corp. will have reduced financial flexibility
within the 'BBB+' ratings to accommodate M&A activity or operating weakness.
This is the result of the lower absolute levels of pro forma EBITDA and free
cash flow, the moderately higher leverage, and the reduced pro forma cash
balance.

Fitch continues to believe that the events at the U.K. newspaper business will
not pressure the company's operations, FCF generating capability, or liquidity
to a degree where there would be a negative rating effect.

The ratings are supported by News Corp.'s business position as one of the
largest and most diversified global media and entertainment companies, with
strong brands and solid market positions in broadcast and cable television,
filmed entertainment, and direct broadcast satellite (DBS) distribution. Fitch
believes the growth profile and global positioning of the company's cable
network division can offset cyclical and secular challenges at News Corp.'s
other businesses. The company's Filmed Entertainment unit continues to generate
best-in-class margins and has produced extremely consistent results over the
last decade, though Fitch remains cautious on this business, given the general
hit-driven volatility of the movie industry. Fitch is positive on TV studios
amid growth of digital distribution and new digital windows.

RATINGS DRIVERS

Positive: Upward momentum to the ratings is unlikely, particularly given the
publishing spinoff, which positions News Corp. moderately weaker in the ratings
category, and the headline risk surrounding News of the World. Fitch believes
there is little incentive for management to maintain a long-term credit rating
above 'BBB+'.

Negative: A downgrade could occur if revised financial policies result in a
material reduction in financial flexibility and liquidity. Despite secular
challenges, a downgrade based on operations is unlikely over the short term.
However, a downgrade could occur amid greater-than-expected pressure in local
television, Fox Network ad sales, and subscriber churn at Sky Italia without
commensurate increases at the company's cable network segment. Should legal or
regulatory investigation-related events unfold such that Fitch believes a large
portion of the company's operations will be materially negatively affected,
negative rating actions would be likely.

At June 30, 2012 News Corp.'s total debt was $15.5 billion, consisting primarily
of senior unsecured notes issued at News America Inc. (some are issued under
that entity's former name, News America Holdings, Inc.).

Fitch rates News Corp. as follows:

News Corp.
--Issuer Default Rating (IDR) 'BBB+'.

News America, Inc.
--IDR 'BBB+';
--Senior unsecured 'BBB+'.