News Corp to raise $1b as it looks at potential buying spree

Rupert Murdoch’s News Corporation will raise nearly $1 billion in debt from the private market as it looks at a potential buying spree to boost the company’s revenue.

The US-based media business, which owns The Australian, The Wall Street Journal and The Times, told the New York stock exchange on Thursday morning (Australian time) it would offer $US750 million ($985 million) in senior notes which it intends to use for general corporate purposes such as acquisitions and day-to-day operations.

News Corp, led by global chief Robert Thomson, has announced two key acquisitions in recent weeks.
News Corp, led by global chief Robert Thomson, has announced two key acquisitions in recent weeks.

Senior notes are a type of debt that is prioritised over unsecured debt if a company goes into liquidation. It is unclear which assets News Corp may be interested in, but any potential acquisition would add to several bids lobbed by the media company in recent weeks, including a $US349 million deal for Lord of the Rings publisher Houghton Mifflin Harcourt and financial tip sheet Investor’s Business Daily.

“News Corp plans to use the net proceeds from the offering for general corporate purposes, which may include acquisitions and working capital,” the company said in a statement.

The company’s ASX-listed depository interest hit a record $32.81 last month and has grown 40 per cent this year so far amid a number of acquisitions.

It bought Investor’s Business Daily from O’Neil Capital Management last month and announced last week it would buy the books and media segment of Houghton Mifflin Harcourt and combine it with its HarperCollins business.

The debt raise will follow one of the best financial performances for News Corp in years. The company said in February it had posted a $US261 million profit for the December quarter, which it said was due to cost cuts and a strong performance from its local pay TV company, Foxtel.

Chief executive Robert Thomson said at the time it was the strongest quarterly result since the publishing and digital media company was split from the Murdoch family’s US entertainment assets in 2013.


The Murdoch family’s other US entity, Fox Corporation, is separately looking at ways to expand its business.

Fox Corp chief executive Lachlan Murdoch, who has added billions to Fox Corp through digital sports betting assets, is considering a push into the local wagering market. This masthead reported last month Fox Corp has worked with other investors on a potential bid for parts of ASX-listed gaming operator Tabcorp. It has also registered a trademark for betting arm FoxBet in Australia.

News Corp was last trading 0.1 per cent higher on the ASX at $32.17.

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