Plans special shareholder meeting

News Corp. took its biggest step yet towards a planned split Friday in a proxy statement laying out the operational and financial structure of what it’s calling the “new News Corp.”

That’s the entity that will be spun off from what’s going to be known as the Fox Group, which will house all entertainment assets. News Corp. plans to hold a special shareholders meeting in 2013 to vote on the separation, which it has said would be done by the summer. Stockholders are for the most part wildly enthusiastic about the split, but in any case News Corp. wouldn’t have to convince too many of them. Chairman Rupert Murdoch controls nearly 40% of the voting stock and close ally Saudi Prince Alwaleed Bin Talal another 7%.

The proxy, a hefty, circa 200-page filing outlining the corporation for shareholders and prospective investors, repped a formal application to the Securities and Exchange Commission to start the process to create “new” News Corp. as, a first, a wholly owned subsidiary of parent Fox Group. It will then be split off into a publicly traded company with its own stock. That’s done by issuing shares for the new company and distributing all of them to current shareholders of News Corp.

The media conglom has always revealed stats on all its businesses in quarterly earnings reports, but now it will need to drill deeper into the publishing numbers. It said the “new” company posted a pro forma net loss of $2 billion for the fiscal year ended June 30 on revenue of $8.6 billion, after a hefty, previously announced $2.6 billion write-down of some newspapers and other assets.

Revenue for the new News Corp. was split among advertising ($4.7 billion), circulation and subscription ($2.4 billion), and consumer ($1.1 billion).

The proxy described a business divided into five operating segments.

-News and Information Services, including The Wall Street Journal, Barron’s, MarketWatch, AllThingsD, Dow Jones Newswires and Factiva; The Australian , Herald Sun, The Daily Telegraph and The Courier Mail newspapers in Australia; The Times, The Sunday Times and The Sun in the U.K.; the New York Post; and News America Marketing. This division, the biggest, posted revenue of $7 billion for the fiscal year ended in June with cash flow of $939 million.

-HarperCollins, the world’s third largest consumer publisher based on revenue with imprints including Avon, Harper, HarperCollins Children’s Publishers, William Morrow, Zondervan and Thomas Nelson. It had sales of $1.2 billion on cash flow of $86 million.

-Digital Real Estate Services, comprising 62% of Australia’s REA Group, a leading digital advertising company specializing in real estate services. This biz had revenue of $286 million and cash flow of $129 million.

-Amplify, the startup education division led by Joel Klein that lost $372 million on revenue of $121 million.

-Fox Sports Australia sports programmer is also part of new News Corp. It’s one of the entertainment assets plucked out it seems to keep all the Australian assets under one roof.

The “new” company will also own 50% of Foxtel, Australia’s largest pay TV provider with 2.2 million subscribers.

The proxy said the competitive strengths of the new News Corp. come from an extensive brand portfolio, global reach, leadership in Australia’s media, sports and print, strong balance sheet and diversified revenue base.

The move will also provide a currency for newspaper acquisitions amidst speculation that News may bid for the Los Angeles Times or the Chicago Tribune as parent Tribune company emerges from bankrupty. Showbiz investors who hated News Corp.’s WSJ acquisition and don’t like the challenged print business or the U.K. phone-hacking scandal, can watch, happily ensconced as shareholders of Fox Group.

As previously reported, Murdoch will remain chairman of the company, Robert Thomson was named CEO and Bedi Singh CFO. Thomson and Singh will receive base salaries of, respectively, $2 million and $1.1 million and as yet unspecified bonuses.

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