Billionaire Rupert Murdoch promoted eldest son Lachlan Murdoch to non-executive co-chairman of News Corp. (NWSA) and 21st Century Fox Inc. (FOXA), placing him near the top of the companies as part of succession planning for the media empire.
Lachlan, 42, will work alongside his father, who will stay as chairman and chief executive officer of Fox and executive chairman of News Corp., according to statements from the two companies, each controlled by Rupert Murdoch. Younger son James Murdoch, 41, will become co-chief operating officer of 21st Century Fox.
The promotions signal Rupert Murdoch, 83, is cementing his family’s control over the business he has led for six decades. Lachlan is returning to a leadership role at his father’s business after running his own company for several years and will rank higher than James, who stayed at the family empire and battled revelations of hacking by its U.K. newspaper reporters.
“Lachlan is a strategic and talented executive with a rich knowledge of our businesses,” Rupert Murdoch said in a statement.
Fox is the owner of a Hollywood film and TV studio, Fox broadcasting and cable channels F/X and Fox News. Murdoch split Fox last year from his News Corp. publishing unit, with assets such as the New York Post and the Wall Street Journal.
Fox rose 0.5 percent to $31.64 yesterday in New York, giving the company a market value of $73.5 billion. News Corp. fell 0.6 percent to $17.36 and is worth $9.9 billion. Both companies are based in New York.
Rupert Murdoch started his media business in Australia after inheriting regional publishing assets from his father. In 1985, he became a U.S. citizen as he sought to add TV assets and in 2004 moved the media company to the U.S.
Lachlan Murdoch started at his father’s business two decades ago and quit as deputy chief operating officer in 2005 to move to Sydney and start his own investment company Illyria Pty. He remained a director of his father’s media company and is married to Sarah, a model and television presenter.
In 2010 he teamed with billionaire James Packer to buy almost 20 percent of Ten Network Holdings Ltd., Australia’s third-largest commercial broadcaster. In 2011 he became the company’s acting CEO before relinquishing the role to become chairman, a position he stepped down from today.
James Murdoch, who will continue to report to Fox Chief Operating Officer Chase Carey, will have direct responsibility for the Fox Networks Group, and the strategic and operational development of the Sky and Star pay-TV units in Europe and Asia. He has been at the company for 17 years is a director of both Fox and News Corp.
“Our management team has always been one of our core strengths, and there is no doubt that we become even stronger by building on James’ and Lachlan’s collaboration,” Rupert Murdoch said in a memo to Fox employees.
Murdoch has faced challenges from investors seeking to loosen his family’s grip, leaving his sons needing to prove they can boost sales and earnings even as publishing and TV businesses face competition from online rivals.
In October, 21st Century Fox investors not affiliated with the family supported a proposal to create an independent chairman. Lachlan wouldn’t have been re-elected to the board without his father’s votes.
A scandal at News Corp.’s U.K. unit in 2011, before the company was split in two, led to James’s resignation from a number of positions as his oversight of the newspapers was questioned. News Corp.’s News of the World tabloid was shut after it was revealed that journalists hacked into the phones of their subjects, including a murdered teenager.
Some of the company’s other executives, including Rebekah Brooks, the former head of News Corp.’s U.K. unit, have been investigated for bribing public officials.
The hacking controversy scuppered the company’s takeover plans for British Sky Broadcasting Group Plc, the U.K. pay-TV company in which Murdoch owns 39 percent, and James resigned as its chairman in 2012. He has denied any knowledge of widespread hacking at the company’s newspapers.
The resignation was his biggest sacrifice during the scandal, which started in 2011. James Murdoch was put in charge of News Corp.’s operations in Europe and Asia, including the British newspapers, in 2007.
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