JULIA WERDIGIER & ALAN COWELL
BSKYB,the British satellite broadcaster partly owned by the Murdoch family,said on Tuesday that James Murdoch had resigned as chairman to shield the company from the phone hacking scandal engulfing his familys British newspaper group.
BSkyB said Nicholas Ferguson,the deputy chairman,would succeed Murdoch as chairman. Murdoch will remain a non-executive director of the company.
I am aware that my role as chairman could become a lightning rod for BSkyB and I believe that my resignation will help to ensure that there is no false conflation with events at a separate organisation, Murdoch wrote in a letter to the BSkyB board.
The Murdoch family owns about 40 per cent of BSkyBs stock and had hoped to acquire the rest. Along with its news division,Sky also operates lucrative sports,movie and general entertainment channels. But as the hacking scandal gripped the nation last July,the family announced that it was withdrawing a $12 billion bid to buy complete control of the broadcaster.
On Tuesday,Patrick Yau,an analyst at Peel Hunt in London,said the resignation was positive for investor sentiment as it removes the uncertainty about whether he was going to go or not.
The news that Murdoch was stepping down came only weeks after he resigned as head of his familys scandal-ridden newspaper properties in Britain.
At the time,he said he would work from the New York headquarters of News Corp.,the global media conglomerate run by his father,Rupert Murdoch,who is chairman of the company.
James Murdoch,39,is deputy chief operating officer of News Corp.,according to its website.
His resignation as executive chairman of News International,the British newspaper subsidiary of News Corp.,came at a moment of intensifying scrutiny of the Murdoch tabloids at the centre of the British hacking scandal,The Sun and the now-defunct News of the World.
The papers reporters,editors and corporate executives,including Murdoch,have been the focus of overlapping investigations by the police,Parliament and the judiciary into a pattern of widespread phone hacking and payoffs to the police and other public officials.
Britains regulator for the communications industry,Ofcom,said last month it was stepping up a probe into whether James Murdoch was a fit and proper to be part of the BSkyB board. Last month,in a continuing effort to distance himself from News Corp.s British newspaper unit,Murdoch stepped down from the board of Times Newspapers Holdings. That entity was created to safeguard the editorial independence of The Times of London and The Sunday Times after the media conglomerate bought the British newspapers in 1981.