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Category: Chase Carey

News Corp.'s Teri Everett exiting; Julie Henderson to replace her

Rupert Murdoch's top spokesperson is leaving his media empire.

Teri Everett, senior vice president of corporate affairs and communications for Murdoch's News Corp., is exiting the media giant in two weeks.

Julie Henderson, head of communications for News Corp.'s West Coast operations, will take Everett's position and split her time between the company's New York headquarters and Los Angeles. JulieHendersonHeadshot

The departure of Everett, who told Murdoch late last year that she wanted to leave because she was "ready for something new," comes as News Corp. tries to distance itself from the phone-hacking scandal at its British newspaper unit that has led to the closing of the News of the World tabloid, the resignations of top executives and the arrest of several staff members.

She had been with the company since 2000, working primarily with former News Corp. Chief Operating Officer Peter Chernin before being promoted to Murdoch's spokeswoman in 2009.

One of the challenges for News Corp.'s communications staff has been managing the ethics scandal. There were disputes within the company over how best to proceed. Early on, News Corp. executives mistakenly thought that the revelations of phone hacking by members of News of the World into voicemail accounts of celebrities and crime victims would not explode into a global story. 

The communications team has had to walk a fine line between assuring Wall Street that the debacle has had little significance to the company's bottom line while appearing contrite to British officials probing the company.

In a statement, Murdoch said he was "grateful" to Everett's service to the company. Everett declined to discuss her future plans.

Henderson was not a surprise choice to succeed Everett. Over the last two years, she has developed a close working relationship with Chase Carey, News Corp.'s president and chief operating officer and the highest-ranking executive at the company to not have the last name Murdoch. Underscoring his reliance on her, Carey last year named Henderson to a high-level committee that brought the company's various divisions together to brainstorm new products, distribution models and approaches to marketing.

Carey is seen as likely to one day succeed Murdoch as chief executive until one of his children is ready to assume it. His youngest son, James Murdoch, had long been seen as the heir apparent, but he has been badly tarnished by the hacking scandal.

While Henderson will now be News Corp.'s top communications executive at the company -- she will serve in the newly created position of chief communications officer -- Murdoch will continue to also rely heavily on strategic advice from outside public relations firm Rubenstein Communications Inc. 

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Photo: Julie Henderson. Credit: News Corp.

Rupert Murdoch and sons reelected to News Corp. board

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Rupert Murdoch and his sons survived a shareholder challenge to their control of News Corp.

Following the company's annual meeting in Los Angeles on Friday, News Corp. announced that Murdoch, his sons James and Lachlan, and the remainder of the board had been reelected -- despite calls from some shareholders for their ouster.

News Corp. declined to announce the vote tally, saying it would release figures early next week.

The vote is expected to be a referendum on Murdoch's stewardship of the $33-billion-a-year conglomerate that owns the Fox broadcast network, Fox News Channel, the 20th Century Fox movie studio, HarperCollins publishing house and such newspapers as the Wall Street Journal.

The media company has been under increasing pressure to make dramatic changes to its management structure. Some investors have lobbied to reduce the influence of the 80-year-old Murdoch and his family since a tabloid cell phone hacking scandal in Britain exploded into front-page headlines in July.

Operatives for News Corp.'s now-defunct News of the World tabloid illegally eavesdropped on cellphone messages left for members of the royal family, celebrities, soccer stars, British soldiers and crime victims.

Murdoch's critics knew that they faced an uphill battle to unseat Murdoch and others on the board. Murdoch and his family control about 40% of the voting shares. A close ally holds an additional 7%. That meant that nearly every other shareholder would have had to vote against Murdoch to topple him.

On Friday, about a hundred shareholders attended the meeting in a theater on News Corp.-owned 20th Century Fox's movie studio lot in West Los Angeles. Some expressed support for Murdoch. But several investors demanded that more independent members join the board of directors.

Venture capitalist James W. Breyer, 50, a partner at Bay Area-based Accel Partners, was elected to the board as an independent director.

Investors, who have long been critical of the company's management structure, were emboldened to lobby for changes in light of the scandal.

"We have found the board's response to be inadequate," said Julie Tanner, assistant director of Christian Bros. Investment Services Inc., which made a motion on Friday -- which was defeated -- to break up the job of chairman and chief executive. Murdoch serves as both.

Corporate governance experts have long decried News Corp.'s dual-class structure, contending that it provides Murdoch with undue influence to run News Corp. like his own personal fiefdom with little accountability to shareholders.

Although Murdoch and his family alone control 40% of the company's voting shares, they own only about 13% of all of the shares outstanding.

The dual-class structure -- with Class A and Class B shares -- allows votes only to shareholders who own News Corp. Class B shares. The vast majority of News Corp. investors own Class A shares and do not have a voice in company matters.

"It's time to get on the governance high road," said Stephen Mayne, an Australian shareholder who said he spent thousands of dollars to travel to Friday's meeting. Mayne, who previously worked at a Murdoch paper, said: "You should get with the program and embrace a board with more independent board members."

But Murdoch was undeterred.

"I'm very proud of the culture of this company," he told his critics. "Have there been mistakes made? Yes, and we are putting them right. We will stop at nothing to get to the bottom of this and make things right."

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Photo: Rupert Murdoch speaks outside a hotel in London where he met the family of slain teenager Milly Dowler on July 15, 2011. Credit: Kirsty Wigglesworth / Associated Press

 

Rupert Murdoch's compensation swells to $33.3 million in 2011

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News Corp. Chief Executive Rupert Murdoch continues to be one of the most richly compensated executives in America -- collecting $33.3 million for fiscal year 2011.

The 80-year-old media mogul's salary and stock package soared 46% over 2010 because of the addition of a $12.5-million bonus.  

The company's top executives have been struggling to contain widespread damage from the British phone hacking scandal. The crisis exploded in July with revelations that reporters for Murdoch's now-defunct News of the World tabloid in London eavesdropped on cellphone messages of royal family members, celebrities, sports figures, crime victims and fallen soldiers. 

Rupert Murdoch and his son James Murdoch, who runs the company's European operations, are expected to be called before a high court later this year to account for the scandal.

Rupert Murdoch qualified for the full amount of his target bonus in 2011 because of his leadership "through the recent economic downturn, positioning the company for long-term growth and ongoing strategic development," according to the News Corp. proxy which was filed with the Securities and Exchange Commission on Friday morning.  The company's fiscal year ended June 30.

In 2010, Murdoch collected $22.7 million.  Each year he receives an $8.1-million base salary, an amount which has long raised the eyebrows of corporate governance experts because it is not linked to the company's financial performance.  Murdoch also was paid $8.5 million in stock awards.

His second-in-command, Chief Operating Officer Chase Carey, received $30.2 million in fiscal 2011.  Carey's compensation included a $4-million base salary, a $10-million bonus and $15.2 million in stock awards.

James Murdoch, 38, who has been under increasing pressure for his handling of the British phone hacking crisis, was paid $17.9 million.  He received $3 million in salary, $8.3 million in stock awards and a $6-million bonus.

James Murdoch's compensation soared 74% over 2010 when he received $10.3 million.  He was elevated to the No. 3 position in the company in late March -- three months before the phone hacking scandal exploded into front page news in Europe, Australia and the U.S.

James Murdoch is expected to be called back before a committee of the British Parliament to further explain his role in the scandal.  After he answered questions this summer, two former associates challenged his account of when he first learned of the widespread nature of the illegal activities at the News of the World. 

James Murdoch "played an important role during fiscal 2011 in developing the company's key businesses and investments in Europe, Asia and the Middle East," the filing said. He also "successfully transitioned into his new role as deputy chief operating officer ... expanding his responsibilities."  

Roger Ailes, chairman of the popular Fox News Channel, received $15.6 million in compensation.  That included a $5-million base salary, a $1.5-million bonus, $8 million in non-equity incentive compensation and nearly $282,000 for corporate jet privileges, a car and driver, and personal security.

Chief Financial Officer David F. DeVoe's compensation package topped $18.2 million -- more than double the $7.1 million he received in 2010.  DeVoe's compensation jumped because of the addition of a $5-million bonus and $9.5 million in stock awards.

News Corp. separately said that it was nominating James W. Breyer, a venture capitalist, to serve on the company's board of directors.  Two directors are stepping down -- Kenneth E. Cowley and Thomas J. Perkins.  Five years ago, Perkins resigned from the Hewlett Packard Co. board after that company had hired an investigator to obtain his phone records.

News Corp. did not say why Perkins or Cowley, both longtime directors, were exiting after the company's annual meeting in October. 

News Corp. had planned to nominate Murdoch's 43-year-old daughter, Elisabeth Murdoch, to the board. However, in August she delayed her nomination in the wake of the company's various controversies, including shareholder lawsuits filed after News Corp. paid $675 million to buy her London-based TV production company Shine Group. Of that amount, Elisabeth Murdoch received $214 million.

In a departure, News Corp. said it would hold its annual meeting with shareholders Oct. 21 at the Fox lot in Los Angeles.  News Corp. typically holds its annual meeting in October near the company's headquarters in New York.

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Photo: Rupert Murdoch. Credit:  Ben Gurr / Reuters

News Corp. shares soar amid market rally

Investors for the last month have been punishing Rupert Murdoch, pushing down the value of his media company News Corp. by nearly 25% as the company has struggled to contain the damage from illegal phone interceptions by operatives of one of his London tabloids.

All that changed Thursday.  Amid a broader market rally, shares of News Corp. went on a tear, gaining 18% in value after the company's fourth-quarter earnings beat analysts' expectations.  In an earnings conference call after markets closed Wednesday, analysts seemed mollified that no new bombshells were about to come out. 

Rupert Murdoch Instead, News Corp. executives said they would raise the dividend and buy back at least $5 billion in News Corp. shares.  Shares closed Wednesday (before the conference call) at $13.71, and by midday Thursday they had climbed to $16.20.

The share price is still down about 10% from its pre-scandal trading levels. The day the British crisis exploded, July 5, News Corp. shares topped $18 a share.

On Wednesday, the 80-year-old mogul said he was not planning on stepping down from the chief executive role. However, he said that Chase Carey, the chief operating officer, and not one of his children, would step into the role immediately if Murdoch "was run under a bus."

Carey also calmed investors by saying  the company was not planning to go on a spending spree.  News Corp. had built its cash reserves to more than $13 billion so that it could buy out the remaining shares of British Sky Broadcasting, the largest pay TV service in Britain.

Last month, News Corp. was forced to withdraw its bid, valued at $12 billion, amid the fall-out of the News of the World phone hacking scandal and criticisms by members of the British Parliament that Murdoch already had too much media power.

"We plan to use this cash to continue to pursue additional buybacks beyond the $5 billion one recently announced if our stock continues to be undervalued, and today it is woefully undervalued," Carey said.

-- Meg James

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 Photo: Rupert Murdoch. Credit: Louis Lanzano / Associated Press

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