Reshuffle at top shows Murdoch still has designs on Sky takeover
Wednesday 04 April 2012
BSkyB's decision to promote Nicholas Ferguson to chairman and News International (NI) boss Tom Mockridge as his deputy shows Rupert Murdoch remains focused on taking over the pay-TV giant, analysts said last night.
Mr Ferguson, who was previously deputy chairman, has replaced Mr Murdoch's son, James, who finally stepped down from the chairman's role yesterday because of the furore over phone-hacking at NI.
James Murdoch will remain as a Sky non-executive director as well as deputy chief operating officer of News Corporation, which is led by his father.
News Corp which owns 39 per cent of Sky, was close to completing its takeover of the pay-TV giant last July, but had to abort the plans because of the News of the World scandal.
Rupert Murdoch remains keen to buy all of Sky because it is highly profitable. Analysts said Mr Ferguson, a staunch Murdoch loyalist, and Mr Mockridge, who previously ran Sky Italia, will be well-placed to support any future bid from News Corp once the hacking row has abated.
Some City investors welcomed the reshuffle. The Local Authority Pension Fund Forum said it was "right" for James Murdoch to quit.
But shareholder watchdog PIRC said: "We believe it would be best for the company and its shareholders if he left the board entirely, and would find it hard to support his re-election."
Regulator Ofcom warned that James Murdoch's resignation would not change its investigation into News Corp's existing 39 per cent stake in Sky.
"We continue to gather evidence which may assist us in assessing whether BSkyB is and remains fit and proper to continue to hold its broadcast licences," said Ofcom, noting that this includes "controlling directors and shareholders".
Mr Ferguson, who is quitting this year as chairman of private-equity firm SVG Capital, is well known to Sky shareholders. He has been a director of Sky since 2004 and served as "de facto" chairman during the takeover talks with News Corp.
He hit the headlines in 2007 when he said it was wrong that people working in private equity were "paying less tax than a cleaning lady".
Some investors will be unhappy that Mr Ferguson has taken the chairman's role because they have called on Sky to have a more independent board.
Those fears will be fuelled by the elevation of Mr Mockridge, who is also chief executive of NI, owner of The Sun and The Times.
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