Tom Mockridge has resigned unexpectedly as chief executive of Rupert Murdoch’s UK newspaper arm after being passed over for the chief executive position at the publishing company that News Corp is expected to spin off next year.
Report by Financial Times Online
News Corp confirmed late on Sunday that Mr Mockridge would leave at the end of December “to pursue outside opportunities”.
Mr Murdoch said he was sorry to see a near-22-year veteran of News Corp leave: “Tom has always been a skilled executive and a trusted friend. His decision to step down is absolutely and entirely his own,” he said.
The New Zealander started in News Corp’s Australian newspapers and ran its Sky Italia pay-television business before being sent to stabilise News International’s Wapping headquarters after the phone hacking scandal swept out his predecessor, Rebekah Brooks.
His exit robs Mr Murdoch of another senior executive after 18 months of high turnover in its top ranks, precipitated by the UK scandals. News Corp is trying to put together two executive and non-executive teams for the entertainment and publishing companies that will emerge from its planned split.
In an email sent out to News International staff, Mr Mockridge said he was leaving because “the new structure does not offer me a role I am comfortable with and, after 22 years with the company in five countries, I feel I have made enough of a contribution to make a personal choice to go.”
One of the key challenges for his successor, he said, was to position News International as a business that is “economically indifferent as to whether customers buy print or digital”.
Mr Mockridge said he expected a full statement on the corporate changes at News Corp to be released shortly but people familiar with the matter confirmed that Robert Thomson, a close confidant of Mr Murdoch who is now managing editor of The Wall Street Journal and editor-in-chief of Dow Jones newswires, would take over as chief executive of the publishing company.
Mr Mockridge’s role is expected to be filled by another company lieutenant, one person familiar with the situation said. Since his appointment in July 2011, Mr Mockridge is credited with stabilising a business in turmoil, building a new senior team and developing new revenue streams such as digital subscriptions.
Mr Murdoch will chair the publishing company and be both chairman and chief executive of the far larger entertainment company, where Chase Carey is expected to remain as chief operating officer.
Full details of the two boards’ compositions are unlikely to emerge this week, but Elisabeth Murdoch, who sold her production company to her father’s group last year, is not expected to join either board, people familiar with the situation said.
James Murdoch, Mr Murdoch’s younger son who is taking an increasingly prominent role in News Corp’s US television interests, is expected to stay with the entertainment company.
Lachlan Murdoch, Mr Murdoch’s Australia-based older son, is likely to side with the publishing company, which will house News Corp’s Australian TV and digital interests as well as its US, UK and Australian newspapers and the HarperCollins book publishing business.
Gerard Baker, deputy managing editor of The Wall Street Journal, is expected to be named managing editor of the group’s flagship newspaper, succeeding Mr Thomson.
News Corp is expected to file financial details regarding the separation by the end of the year. Executives have pegged the split to be complete by next June. Shareholders and campaigners who have long criticised News Corp’s governance are expected to scrutinise the board composition to see whether both companies will have a majority of genuinely independent directors.
Analysts expect the two groups to have very different prospects. In the most recent quarter, News Corp’s cable network, filmed entertainment and television businesses reported increases in operating income, driven by a 16 per cent rise in cable network revenue. Operating income in the publishing segment, meanwhile, nearly halved in the quarter.
Mr Thomson will be taking the reins of a group hit hard by the digital transformation upending print. However, the inclusion of Australian TV sports and online property classified advertising assets in the spin off could bolster profits at the new company, which is expected to start with no debt and cash of $1bn or more.
An Australian native who started as a copyboy at The Herald in Melbourne in 1979, Mr Thomson became editor of the Wall Street Journal and Dow Jones in 2008, following News Corp’s $5.6bn acquisition of Dow Jones.
During his tenure, the largest US newspaper by circulation significantly expanded its coverage beyond financial and corporate news, including more political reporting and adding new sections for topics such as New York and real estate.
Before joining the Journal, Mr Thomson edited The Times, another News Corp newspaper. He previously worked as editor of the US edition of the Financial Times. Mr Baker has been deputy editor of The Wall Street Journal since 2009. He previously worked as a journalist at the BBC, the Financial Times and The Times.
Mr Mockridge sits on the boards of BSkyB and Sky Deutschland and chairs Fox Turkey. It was not immediately clear how those roles would be affected.'