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News Corp Shakes off Scandal

Wednesday, May 09, 2012 - 02:04

May 9 - As News Corp reports stronger than expected results, big questions remain about its ownership stake in BSkyB. Sasha Salama reports.

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You couldn't tell from its better-than-expected earnings report that News Corp's been mired in scandal. Analysts say the $50 billion media empire is in a very solid financial position despite the ongoing phone hacking and bribery scandal surrounding Chief Executive Rupert Murdoch. It's News Corp's President and COO who's kept the media juggernaut powering ahead, according to Mediatech Capital's Porter Bibb. SOUNDBITE: PORTER BIBB, MANAGING PARTNER, MEDIATECH CAPITAL PARTNERS (ENGLISH) SAYING: "Chase Carey and his team have built Fox News into a powerhouse. They've got Fox Network firing on all cylinders. 20th Century Fox is a well managed film company." According to Bibb, News Corp's only weak link is on the print side of the business. SOUNDBITE: PORTER BIBB, MANAGING PARTNER, MEDIATECH CAPITAL PARTNERS (ENGLISH) SAYING: "It's the newspapers that are slow growth, or no growth properties, and, to a certain extent, Harper Collins, the book publishing business." But News Corp's print exposure has been dwarfed by its interest in broadcast properties such as satellite broadcaster BSkyB. Currently, News Corp is BSkyB's biggest shareholder with a 39-percent stake. Communications regulators in the UK are expected to rule next month on whether or not News Corp is fit to own that stake. Even if News Corp is forced to divest part or all of it, Porter Bibb sees a silver lining. SOUNDBITE: PORTER BIBB, MANAGING PARTNER, MEDIATECH CAPITAL PARTNERS (ENGLISH) SAYING: "They will have $8-10 billion in cash from the proceeds of that sale and that will give them the opportunity to invest heavily in other assets, probably in the United States." And judging from the strength of News Corp's bottom line, growth opportunities of all kinds will be more the rule than the exception going forward. Sasha Salama, Reuters

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News Corp Shakes off Scandal

Wednesday, May 09, 2012 - 02:04