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A Disney Murdoch Inside would bring experience and luggage

With Walt Disney Co. and 21st Century Fox Inc. discussing a historical combination of their businesses, one question keeps coming up: Could a Murdoch end up running Disney?

Disney, the world's largest entertainment company, is in talks to buy Fox assets in an agreement that could approach $ 50 billion or more. The companies have held intermittent negotiations for more than a month for properties that include the FX cable channel, the paid Sky television service in the United Kingdom and the Fox film and television studio in Los Angeles.

James Murdoch, the 44-year-old son of founder Rupert Murdoch and the executive director of Fox, could move to Disney if he were offered a high-ranking position there after a deal. That possibility evokes strong responses from admirers and detractors of the Murdochs and their reign over the Fox media empire.

Some investors and analysts say there are few executives with James' experience in creating and managing an international media business. Others question whether Disney should hire an executive who led a company involved in a scandal, including telephone hacking in the UK and sexual harassment at the top of the Fox News Channel.

"There are two ways of seeing it," said Richard. "Journey" Miller, a Disney shareholder in Gullane Capital Partners. "The Murdochs have been very skilled at creating long-term shareholder value, and on the other hand, some of the more sensational things the Murdochs have done pauses."

Fox, based in New York, declined to comment and said James would not comment either.

An agreement with Burbank, Disney based in California is not sure. Fox, directed by Rupert, James and another son, Lachlan, is not talking exclusively about Disney. There is a possibility that Comcast Corp. may arrive with a better offer or that nothing happens.

James & # 39; s Plans

But he took on the role of managing some of the assets sold to Disney, with a possible path to the best work in the film, television and giant theme park would be an elegant exit for James. He has been busy with the barrage of scandal on Fox News, an organization he has technically supervised but has limited control over.

While his father defended conservative causes, James Murdoch and his wife Kathryn founded Quadrivium, a foundation focused on promoting science, equal opportunities and environmental causes. That makes him more politically aligned with Disney CEO Bob Iger, who left the advisory panel of President Donald Trump over a dispute over climate policy earlier this year.

Entrepreneur like his father, James left Harvard University in 1995 to support a record label that spawned hip-hop acts Mos Def and Talib Kweli. He was the youngest CEO of a FTSE 100 company after his father named him Sky's boss, and was a rising star as head of international operations at News Corp., owner of the Wall Street Journal, Times of London and The Sun. [19659004] "I interviewed James 10 years ago when he was a bright young man on the rise," said Stefan Stern, visiting professor of corporate governance at Cass Business School at the University of London. "We know what happened next."

The revelations that employees of News of The World, a News Corp. newspaper, had pirated the voice mail of celebrities and other public figures cost James his job in News International in 2012 and his President of Sky. The Murdochs were not accused of wrongdoing, and no charges were brought against them or against their company.

Sky Bid

But the Murdoch were forced to abandon the News Corp. effort to buy other investors in Sky, and James was criticized by the UK media regulator OfCom, who said he had failed to take action. News Corp. said the decision was not backed by evidence.

Murdoch spent the following years rebuilding, moving to New York and eventually becoming co-chief operating officer for 21st Century Fox, the media business separated from News Corp. following the piracy scandal.

He played a role in Sky's acquisition of Sky in Sky Deutschland AG and Sky Italia in 2014, and led Fox's investment in Vice Media Inc. In July 2015, he became Fox's CEO. [19659024] A year later, the Murdochs were involved in another scandal, with accusations of sexual harassment against the founder of Fox News Channel, Roger Ailes, and later against Bill O & # 39; Reilly, the most watched. personality in cable news.

The new scandal has complicated the Murdoch's second bid to gain full control of Sky, prompting a new review of UK officials, this time including Fox's handling of harassment cases. In determining that Fox would be an appropriate and apt owner of Sky, OfCom noted that James and Lachlan had reviewed Fox's corporate governance to prevent future misconduct.

While a role for James at Disney is not part of the negotiations, according to people with knowledge of the matter, a deal could offer him a future there.

"There's no doubt that Bob Iger admires James, and Disney's biggest international relationship is with Sky," according to Claire Enders, a founder of Enders Analysis, a research firm in London. As a programming provider such as ESPN and Disney Channel, Disney maintains close links with pay-TV providers such as Sky.

Iger's successors have left Disney in recent years and the board has extended its CEO's recall date four times, a sign that no internal candidate has captivated directors. There is no "anyone in Disney who is so qualified" to succeed Iger as James Murdoch, said Brian Wieser, an analyst at Pivotal Research Group.

If I had the chance, James could prove his worth over time, especially if the Disney board extends Iger's contract again beyond the current July 2019 expiration. CNBC and the Wall Street Journal said on Wednesday that the contract could be extended if Disney made an important deal with Fox.

Governance Issues

However, the idea of ​​James Murdoch assuming a high-ranking role in Disney or successor to Iger provokes strong reactions from the government experts.

"James, despite his personal ambitions, has little credibility to be seen as a successful business builder, a prudent captain of shareholder assets or a sensible guardian of public trust as a media baron – or any business not controlled by the legacy of his father's wealth, "said Jeffrey Sonnenfeld, associate senior dean of leadership studies at the Yale University School of Management.

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