May 24 News Corp set the distribution
ratios for the spinoff of its publishing business, which may
start buying back stock right away.
The board of the publishing business, which will retain the
News Corp name, authorized a $500 million stock repurchase
program, the company said on Friday.
The stock repurchase may shed light for analysts and
investors who want to know how the new News Corp will use the
$2.6 billion in cash it will have when the spinoff takes place.
That is expected to occur on June 28..
Chairman Rupert Murdoch and Chief Executive Officer Robert
Thomson will give more details about the company at a conference
on May 28.
The board of the existing News Corp has now formally
approved the split-up of the company's publishing business from
its entertainment operations. Current News Corp stakeholders who
own four shares of Class A or Class B common stock will receive
one share of new News Corp's Class A or Class B common stock.
To prevent hostile takeovers, News Corp put in place a
poison pill provision for one year after the split. It will be
triggered if someone acquires more than 15 percent of the stock
of either company.
News Corp has a history of potential takeovers. In 2004,
Liberty Media Corp's John Malone had quietly snapped up
a 20 percent voting stake in the company. The move prompted
Murdoch to swap his stake in DirecTV and other assets
for Malone's shares in News Corp.
The new News Corp will be an independent publicly traded
The entertainment assets, including Fox broadcasting
network, movie studio and lucrative equity stakes in pay-TV
providers, will be known as 21st Century Fox.
21st Century Fox will retain no ownership interest in News
Corp, the company said.
The publishing spinoff includes News Corp's newspapers
including The Wall Street Journal and The Times in London, a
cable network and pay-TV provider in Australia, book publisher
HarperCollins and fledgling education company, Amplify.
The company named current directors Lachlan Murdoch and
James Murdoch to the board of the new News Corp. New additions
to the board include Thomson; Ana Paula Pessoa, a partner at
Brunswick Group; John Elkann, head of Exor SpA ; and
Masroor Siddiqui, head of investment firm Naya Management.
At 21st Century Fox, new board directors include Delphine
Arnault, deputy general manager at Christian Dior Couture;
Jacques Nasser of One Equity Partners; and Robert Silberman,
executive chairman of Strayer Education Inc.
Rupert Murdoch will be CEO of 21st Century Fox and chairman
of both companies.
Shares of News Corp were up 0.8 percent at $33.13.