News Corp. executive Chase Carey's contention that the company's $673 million takeover of Shine Group "had nothing to do with" Rupert Murdoch's daughter owning the firm is drawing disbelief among some who follow the media family.
"Rare is the occasion when I get to trot out the phrase 'height of folly,' but Chase Carey's assertion that blood ties had nothing to do with Rupert Murdoch's decision to sink $673.3 million into Shine truly fits the bill," said Anthony Crupi, staff writer for MediaWeek and author of a recent lengthy piece on Elisabeth Murdoch.
"While Elisabeth Murdoch has enjoyed inarguable success as a result of a number of key acquisitions, she still has a lot of ground to cover if she's to be ranked among the elite production companies that operate in the United States," Crupi noted, adding, "Is Shine on the same level as a 20th Century Fox TV? Not at all."
Others in the business press and media analysis circles offered similar views after Carey, News Corp.'s Chief Operating Officer, was quoted Monday denying Elisabeth Murdoch's family ties played any part in the decision to buy Shine Group.
Dow Jones reported:
News Corp.'s recent deal to acquire Shine Group is unrelated to News Corp. Chief Executive Rupert Murdoch's family ties to the U.K.-based television production company, Chief Operating Officer Chase Carey said Monday.
Shine was founded by Murdoch's daughter, Elisabeth Murdoch, who is expected to join News Corp.'s 15-member board after the deal.
"That had nothing to do with it," Carey said of the family relationship, at an investor conference hosted by Deutsche Bank.
Michael Wolff, editorial director of AdWeek Media and author of "The Man Who Owns The News: Inside The Secret World of Rupert Murdoch," appeared to dispute Carey's claim:
"Murdoch told me if he had to buy his daughter's company to get her to come back to News Corp. he certainly would," Wolff said in an e-mail. "My book spells out his precise and considered plan for getting his children to work for his company and to ultimately take it over. Having said that, I should add that by most measures Elisabeth Murdoch is top flight media executive."
Rick Edmonds, a Poynter Institute business media analyst, said the contention that family ties played no role is hard to believe.
"I would say looking from the outside, it would be something of an odd coincidence if it had nothing to do with the daughter and her interest," Edmonds said of the Shine Group purchase. "I don't find that necessarily to be extremely plausible."
One media analyst who follows News Corp., but requested anonymity for fear of retaliation from the company, said Murdoch's family ties likely made Shine more attractive than it would have been otherwise.
"Clearly one of Rupert's priorities is to bring Elisabeth back into the fold and this is one way to do it," the analyst said. "If it were somebody else's company, I think News Corp. would definitely have bid, I don't know if they would have bid that [much]. News Corp. had the inside track, definitely,"
MediaWeek's Crupi offered a similar view and also questioned if the move is the best for News Corp. stockholders:
"I think the core issue has less to do with inheritance and repatriation and everything to do with the power Elisabeth assumed the moment she signed Shine over to her father," Crupi added. "They're both positioning themselves for future growth, it's just that I'm not convinced the deal is in the best interest of News Corp. shareholders."
Alan D. Mutter, an independent media analyst and consultant in San Francisco, said News Corp. could have chosen many other companies for a similar investment.
"The question that could be asked is why this over any others?" Mutter said. "I don't think they overpaid based on the family, but why did they buy this company when they could have paid that much for some other entity? Was this the best deal? That is subjective."
Ken Doctor, veteran news industry analyst for Outsell and author of "Newsonomics: Twelve New Trends That Will Shape the News You Get," said Murdoch's history of family business ties is obvious.
"Certainly, most public companies separate out family dynasty from business decision-making," he wrote in an e-mail. "But the two have always been intertwined at News Corp, and the acquisition of Shine fits that tradition."
Asked what he thinks of Carey's claim that family connections played no role in the purchase, veteran newspaper analyst John Morton stated: "On the face of it, it looks a little strange to say that."