NEW YORK — News Corp. deputy chief operating officer Lachlan Murdoch said the company plans to move forward with an initial public offering of Sky Global Networks when — and if — market conditions improve.
Speaking at an investment conference in Sydney, Murdoch said talks with DirecTV parent Hughes Electronics/General Motors are ongoing, but are also slow and “extraordinarily difficult.”
Sky Global filed preliminary papers for an IPO last year but won’t need one if it merges with publicly traded Hughes.
The fact that IPO talk has resurfaced is the latest indication that News Corp. is discouraged by the pace of discussions. Sky Global houses News Corp.’s worldwide satellite assets but is missing a U.S. component. That makes DirecTV and its nearly 10 million subscribers a perfect fit.
The two sides have been talking for months, with a merger stymied by issues of valuation and control. Many on Wall Street think GM has no other place to turn and will pony up DirecTV eventually. Given the extreme volatility of the market lately, some closure on the deal front is likely to come before any IPO.
A deal with DirecTV’s much smaller rival EchoStar is another possibility.
Murdoch, who has been rapidly ascending the corporate ladder under the eye of his father, News Corp. chief Rupert, also said TV syndication will be News Corp.’s key growth catalyst over the next few years and stuck by guidance of operating income on the low end of a $1.75 million to $1.85 billion range for the fiscal year that ends in June.
He cited a disappointing third quarter in filmed entertainment, but is upbeat on upcoming pics “Dr. Dolittle 2,” “Planet of the Apes” and “Moulin Rouge.”
Making his debut
This was one of the first public appearances at an investment conference for Murdoch, Rupert’s eldest son and heir apparent. He reports to News Corp.’s prexy-chief operating officer Peter Chernin, with whom he has been studying the company’s far-flung businesses and keeping a rather low profile.
Lachlan Murdoch is also still responsible for U.S. print assets and News Corp.’s Australian operations, and has been “much more involved with Fox,” said a News Corp. insider.
Rupert Murdoch turned 70 in March, and the succession question at News Corp. has intrigued media watchers. Chernin is firmly ensconced as second-in-command, but Rupert Murdoch has said he’d like one of his children to take the top job eventually.
Lachlan’s younger brother, James, 28, chairman of News Corp.’s Hong Kong-based satcaster Star TV, is seen as a contender, too.
James, who has generally kept out of the limelight as well, created a furor last month during a presentation at the Milken Institute in Los Angeles where he slammed the Falun Gong in China as a dangerous cult and criticized Western media for biased and negative coverage of China’s human-rights record.