Liz Snubs Rupert Murdoch



(image via dailymail)

It has not been a good couple of weeks for Rupert Murdoch. He had to issue an apology -- a first? -- for a cartoon that was perceived by many as racist. Then Peter Chernin exits stage right. Now this, from Richard Siklos. From Fortune:

"In the weeks that Rupert Murdoch was locked in unsuccessful negotiations to keep his longtime No. 2 at News Corp., the media baron also had to accept his daughter Elisabeth's decision to turn down a spot on the company's board, sources told Fortune.

"Murdoch's interest in having Elisabeth rejoin the family business adds to the palace intrigue surrounding president Peter Chernin's pending departure and the question of who will eventually run the globe-spanning media conglomerate Murdoch assembled and controls through a 37% voting interest. Indeed, Elisabeth was in New York today as an "observer" at the company's first board meeting since announcing Chernin's departure yesterday, two people said. She could not be reached for comment.

The sources said that Elisabeth, known as Liz, was torn about joining the News Corp. (NWS, Fortune 500) board. On the one hand she has a sense of duty and is one of four grown Murdoch children who will one day inherit the family's controlling votes. But she also has a conflict of interest with Shine, the big U.K. production company she has built up over nearly seven years. Under U.K. broadcast regulations, Liz Murdoch's presence on the News Corp. board would have rendered Shine ineligible for the 25% of programming budgets that big British broadcasters like the BBC and Channel 4 are required to spend on independent production houses that have no links to broadcasters. Two people close to Murdoch said that this pool of funding represents a large proportion of Shine's business, and that there are other advantages to being an independent producer that allow Shine to more easily retain the rights to formats it creates. Being on the News Corp. board would be a conflict for Shine because News controls British Sky Broadcasting, the big U.K. satellite TV business, as well as numerous Sky and Fox TV channels that air there. Liz Murdoch owns 63% of Shine and another big backer is Sony Pictures Entertainment, which has 20%."

The full story here.