View Full Version : Murdoch Dynasty 'Will End'

07-31-2005, 10:42 PM
Murdoch dynasty 'will end'
Empire likely to be broken up after founder's death, says former lieutenant


Richard Wray
Monday August 1, 2005
The Guardian

Rupert Murdoch's News Corp media empire is unlikely to survive intact beyond its founder's lifetime and will be broken up, according to a former Murdoch lieutenant.

The prediction by Andrew Neil, the ex-Sunday Times editor, follows the decision by Rupert Murdoch's eldest son, Lachlan, to leave his job as News Corp's deputy chief operating officer to return to Australia. This has prompted speculation that his younger brother, James, BSkyB's chief executive, will now inherit the business when his father dies.

But Mr Neil said yesterday that talk of dynastic empire-building after the surprise departure of Lachlan late last week is a sideshow.
"The idea that he's going to create a dynasty in what is effectively a publicly quoted company ... it ain't going to happen," he said. "They [shareholders] are not going to give the company to someone simply because they have the name Murdoch."

Peter Chernin, 53, News Corp's president and chief operating officer, is set to take over Lachlan's responsibilities.

Mr Neil warned yesterday that the media empire, which encompasses newspapers to a Hollywood studio, is much more likely to be broken up when the founder dies. Waiting in the wings is John Malone, the cable magnate whose Liberty Media group last year built up a stake of just under 20% in News Corp.

Industry experts believe Mr Malone, whose assets include the home shopping channel QVC and half of the Discovery television channels, is interested in cherry-picking News Corp assets and will move to prevent any Murdoch heir assuming his father's mantle.

"The genius of Rupert Murdoch is his ability to keep it all together," said Mr Neil. "Murdoch's genius dies with him."

News Corp spans newspapers including the Times, the News of The World, the New York Post and the Australian; content providers including the 20th Century Fox film studio, the Fox TV network, TV Guide and HarperCollins Books, as well as the broadcasters Sky and DirecTV.

The financial performance of the business has been relatively lacklustre but Rupert Murdoch's force of will and the family's near-30% stake have been enough, so far, to see off any potential investor unrest.

Mr Neil, however, reckoned that once the patriarch is gone, "a lot of the family will just want to cash out" and News Corp could be carved-up as institutional investors look at the value of parts of the empire.

Mr Malone, for instance, is likely to be interested in assets such as Fox TV and possibly the Hollywood studio.

In May Rupert Murdoch said he wanted to buy all or part of Mr Malone's stake in the business, pledging to "resolve the Liberty position" before the end of next month when the company will present its quarterly results to analysts.

Some analysts believe Mr Murdoch could strike a deal with Mr Malone, selling some of News Corp's assets to Liberty in return for his shares.

Meanwhile, News Corp's Australian newspapers would probably be put up for sale, raising the prospect that Lachlan, one-time publisher of the Australian and noted lover of print, could bid. "I would not rule out the possibility that part of the Murdoch family will end up owning parts of the company," said Mr Neil.