News Corporation (NWSA) is considering a plan to split into two separate publicly traded companies, separating its film and TV business from its publishing business. Investors are clearly enthused by the plan; shares are up 6.3% in morning trading. After a Wall Street Journal article about the plan, the company confirmed the possibility in a short press release: “News Corporation confirmed today that it is considering a restructuring to separate its business into two distinct publicly traded companies.”
Some investors have been agitating for News Corp. to split, separating the fast-growing TV and film business from the slower growing publishing brands. The entertainment businesses account for about 90% of News Corp.’s operating profit. A split could also help News Corp.’s attempts to gain control of British satellite broadcaster BSkyB. The company’s attempt to buy the broadcaster fell apart last year amid a phone-hacking scandal at News Corp.’s British newspaper News of the World. “A structural split may reduce cross-ownership issues paving way for a new BSkyB offer in 2013,” wrote Citi analyst Jason Bazinet.
News Corp. owns Barron’s.
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