Murdoch brothers’ symbiotic ties to be tested in Fox cockpit
LONDON/SYDNEY – One has been closely involved with the family business from his early 20s and is driven to succeed. The other had to be lured back from a decade’s hiatus from the company and has operated at the edges of the empire.
Now James and Lachlan Murdoch, octogenarian media baron Rupert’s only sons, are teaming up at the helm of Twenty-First Century Fox Inc (FOXA.O), the crown jewel of the empire their father built.
James Murdoch, 42, is set to be elevated to chief executive of the entertainment company that is home to “The Simpsons” and movie franchises like “Planet of the Apes.” Lachlan, 43, will become co-executive chairman with his father as executive chair, a source familiar with the situation said on Thursday, describing the arrangement as a partnership between the brothers.
Investors say the brothers’ ability to work together is one of the keys to Fox’s future.
“When the old man is gone, who knows what their relationship is?” said Matthew Benkendorf, a portfolio manager at Vontobel Asset Management, which has about 719,000 Fox shares.
Those who know them say the Murdoch brothers could not be more different in style and approach to business, where James is seen to have a much harder edge.
“They are very, very, very different,” said a source who knows the family. “Lachlan’s less confrontational than his brother, he’s easy going, he’s not got that same sort of naked ambition.”
Both, however, have been raised by a father who lived and breathed the News Corp business. “It’s hard to explain: it’s not a normal family; they have been bought up as part of a dynasty with a clear understanding that the business came first,” said the source who knows the family.
The differences could work in their favor as James focuses more on the operational side of the business and Lachlan works with his father on strategic issues.
“They have a good understanding of what each other’s strengths are,” the person said of the brothers, whose filial loyalties were on full display when Lachlan hobbled into High Court in London with his leg in a cast when James appeared regarding the phone hacking scandal that bedeviled Murdoch’s UK newspapers starting in 2011.
RETURN TO THE FOLD
A former News Corp senior employee who asked not to be identified said there had never been “even a hint of” sibling rivalry between the two.
James has had a laser focus on the family business since he joined News Corp following a brief foray into a hip-hop record business after dropping out of Harvard.
That led to the technical and international experience that has left many analysts and investors impressed by his media business chops. It also meant that he had to deal with the hacking scandal, whose aftermath he was accused by some of mishandling, although he was cleared of any wrongdoing.
Lachlan, who had been seen as Murdoch’s natural heir apparent before resigning as deputy News Corp chief operating officer in 2005 after clashing with executives in New York, has taken a more circuitous route back to the top of the family empire.
He mostly focused on interests in Australia while remaining a director at News Corp and Fox until 2014, when he was named to his current position as non-executive co-chairman of the board at both companies – a return to the fold long desired by his father.
One key question left unanswered by the brothers’ joint promotion to the upper echelons of Fox is who, if anyone, will be looking after the print portion of Murdoch’s holdings, grouped into News Corp (NWSA.O) and long their father’s sentimental favorite.
When James Murdoch was named Fox chief operating officer in March 2014, it was assumed that Lachlan, who at the time was also promoted to non-executive co-chairman of both Fox and News Corp, would focus on the latter.
The former News Corp employee believes that is still the case, but Lachlan plans to move to Los Angeles, where Fox’s movie studios are based.
James may not share his father’s passion for print, especially after his rough ride overseeing News Corp’s British newspapers.
“James sees himself as responsible for Fox and has really not wanted to touch the newspapers with a barge pole, and for a considerable period of time,” said Claire Enders, founder of Enders Analysis. –Reuters