News Corporation shares rallied yesterday after chief executive Rupert Murdoch assured investors the media giant was well placed for a strong performance.
Speaking at News Corp's annual meeting in Los Angeles yesterday, Mr Murdoch said he believed the decisions being made by the company would be validated by the market.
"I believe the numbers will bear out that the market likes the work we are doing and has confidence in our future," Mr Murdoch said.
Mr Murdoch said the decision to split the company was driven by moves to realise the full potential of the business, which he said was "undervalued".
"This separation will free up each company to better deliver on its promises to customers across the globe," he said.
"As we do, it will also mean unlocking more value for our shareholders."
The chief executive said the new listed companies would have separate names and different missions. News Corp is expected to offer details about their management and board structures by the end of the year.
Mr Murdoch successfully fended off a shareholder challenge to his dual role as chief executive and chairman of News Corp.
The proposals were defeated in preliminaries.
The Murdoch family controls about 40 per cent of voting stock, but Mr Murdoch said he was conscious of investors' views.
Mr Murdoch also guaranteed the completion of a company buyback from shareholders with $US4.6 billion ($4.51 billion) of a $US10 billion authorised fund pool spent to date on Class A common stock.
News Corp in August reported net profit for the year to June of $US1.2 billion, down from $US2.7 billion the previous year.
News Corp's voting shares closed up 1.1 per cent, or 27c, at $24.54 while its non-voting shares gained 29c to $24.11.
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