News Corp, Ltd headquarters in Manhattan. The media giant said...

News Corp, Ltd headquarters in Manhattan. The media giant said Monday, July 23, 2012, that it is partnering with AT&T to provide tablet computers to students in the coming school year. Credit: AP, 2010

Rupert Murdoch's News Corp. said Thursday that it plans to split into two separate companies, one holding its newspaper business, the other its entertainment operations.

Under the proposal, the global media conglomerate will be divided into two publicly traded companies. One entity will operate as a newspaper and book publishing firm. The other will be an entertainment company that includes the 20th Century Fox movie studio, the Fox broadcast TV network and the Fox News channel.

The Murdoch family, which controls nearly 40 percent of the voting shares in News Corp., is expected to maintain control of both companies.

"There is much work to be done, but our board and I believe that this new corporate structure we are pursuing would accelerate News Corporation's businesses to grow to new heights, and enable each company and its divisions to recognize their full potential -- and unlock even greater long-term shareholder value," Murdoch said in a statement.

The splitting of News Corp. is a symbolic turning point for its 81-year-old chief executive. Murdoch's global conglomerate was built on the foundation of a single Australian newspaper he inherited from his father. Through the years, he maintained a fondness for newspapers even as he purchased entertainment companies and assembled a company with a market value of $52 billion.

Investors have already given their blessing to the split, having pushed shares of the company's Class B stock up almost 10 percent since the news of the plan broke early Tuesday.

Murdoch, who will serve as chairman of both companies and CEO of the media and entertainment company, is hoping the television and movie company will be more highly valued by shareholders who hadn't been willing to accept the dour growth prospects of the newspaper and book business.

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