Murdoch’s sale of UK newspapers moves a step closer, says media analyst

Posted on July 24, 2012

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News Corporation’s possible sale of The Times‘ newspapers and The Sun has moved a step closer following Rupert Murdoch’s decision to step down from a string of director roles, according to a leading media analyst.

Rupert Murdoch: resigns from a string of director roles
Rupert Murdoch: resigns from a string of director roles

Last week Rupert Murdoch stepped down from a string of director roles at his newspaper empire, which includes The Times, The Sunday Times and The Sun.

The chief executive and chairman of News Corporation, has resigned from roles at News International Group Limited, News Corp Investments and Times Newspapers Holdings in the UK, according to accounts files at Companies House.

Murdoch has also stood down from roles on boards in Australian, India and the US.

Alex Degroote, media analyst at Panmure Gordon, said: “Rupert Murdoch’s stepping down from all of News Corp’s UK newspaper boards is consistent with the steady detachment of News Corp (and the Murdoch family) from their British print assets.

“In a way, this move should be seen as symbolic, in that Rupert Murdoch has long been the most vocal and passionate supporter of the newspapers.

“However, it will surely reignite concerns over the commitment of News Corp to The Sun, Times and Sunday Times.

“It also follows on from the major corporate split being undertaken at News Corp, which hives off publishing assets.

“In our view, the probability of a sale or closure – worst case scenario – of the newspaper assets is increasing all the time.

“We doubt it will have any bearing on News Corp’s relationships with UK media regulators, eg Ofcom.

News International, the UK publishing arm of News Corporation, said Murdoch’s resignation was “Nothing more than a corporate house-cleaning exercise”, underscoring that Murdoch was fully committed” to the business.

The move has fed speculation in some quarters that he could sell his UK newspapers in light of the phone hacking scandal, which led to the closure of the News of the World last year.

Murdoch’s son, James, also stood down from a number of directorships at News International last November.

In June this year, News Corporation confirmed speculation that it was splitting into two companies, separating out its publishing division from its faster-growing entertainment unit.

Rupert Murdoch will not be chief executive of the publishing arm, home to The Sun and The Times but he will be chief executive of News Corporation’s faster-growing media and entertainment side of the business.

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