Murdoch pins his hopes on Elisabeth
Will News Corp boss be allowed to put his eldest daughter on the board?
Elisabeth Murdoch is emerging as the family's favourite to take on a top role at News Corporation, and save the dynasty's succession plans, if James Murdoch is forced out over the phone-hacking scandal.
News Corp insiders said yesterday that the chairman, Rupert Murdoch, wants to speed up plans for Elisabeth, his 42-year-old eldest daughter who runs Shine TV, to join the media group's board in a corporate reshuffle to stem the fallout over the UK newspaper scandal.
Mr Murdoch's push for Elisabeth to join News Corp – which she is due to do at October's annual meeting – comes as a growing number of the group's US investors are claiming that James Murdoch should quit as deputy operating officer because of his role in the phone-hacking and policy bribery affair.
However, other investors and analysts argue that suggestions that Mr Murdoch will continue to push for his family to increase their influence in the company would be met with contempt. Instead,they are hoping Mr Murdoch will hand over the reins to Chase Carey, the chief operating officer, who has a strong reputation on Wall Street.
News Corp already faces one lawsuit in the US from the Amalgamated Bank, claiming that News Corp overpaid for the $615m purchase of Elisabeth's Shine TV production company. Amalgamated, along with other US pension funds, is suing Rupert and James Murdoch over alleged "negligence", arguing that Murdoch junior should step down from News Corp as he bears ultimate responsibility for what went on at the UK newspapers. "Rebekah Brooks was the shield for James. But he has to go too if Murdoch really wants to clean up," said one.
James's position as chairman of BSkyB, which is 40 per cent owned by News Corp, is also being scrutinised by some of the broadcaster's biggest investors. His position is due to be discussed at a meeting of non-executive directors to be held over the next week or so, ahead of BSkyB's annual results, due on 29 July.
One of the City's toughest businessmen, Nicholas Ferguson, the senior independent non-executive director at BSkyB since 2007, will take the lead at the meeting. Ferguson and his fellow directors will have to decide whether the role of James – and News Corp's decision to drop the full takeover bid for the broadcaster – means the relationship with the Murdochs needs to be changed. Several of Sky's big investors have questioned whether corporate governance needs to be changed in the light of the collapse. Shares in BskyB, which have lost billions in value since hopes of a bid receded, recovered slightly on Friday to close at 706p.
The scandal has already cost Les Hinton, chief executive of Murdoch's Dow Jones group and Rebekah Brooks, chief executive of News International, their jobs. Shares in News Corp, which have lost more than $2bn over the past 10 days, despite Murdoch's $5bn share-buy-back plan, firmed to $16 on Friday.
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