News Corp to split

NEWS Corp will split into two after its board last night approved the move separating publishing assets from entertainment businesses.

The publishing business consists of newspapers in Australia, the US and Britain, as well as book, education and marketing assets. The media and entertainment company includes film and TV assets.

The move is expected to boost the sharemarket value of the combined businesses, with the entertainment businesses seen as attracting a higher premium when freed from the less profitable publishing business.

While the split is sure to unlock value for the newly formed entertainment company, the publishing entity will require significant cost cutting, according to Ken Doctor. Photo: Bloomberg

With the action, Mr Murdoch, 81, is bowing to shareholder demands after a costly year-long scandal at his treasured newspaper operation, which is seen as a drag on the larger and growing film, broadcast and pay television units.