Carey pressured from both sides of Fox Time Warner deal to stay in job
By Ronald Grover , Jennifer Saba and Liana B. Baker
LOS ANGELES/NEW YORK (Reuters) - Chase Carey, Twenty-First Century Fox's (FOXA.O: Quote) president and chief operating officer, may be feeling pressure to stay in his job for several more years both from his boss, Rupert Murdoch, and from the company Murdoch is trying to buy, Time Warner Inc (TWX.N: Quote).
As Murdoch mulls his next step following Time Warner’s rejection of his $80 billion offer, some Time Warner investors say they are concerned about who might succeed the 83-year-old chairman and chief executive. In particular, they're not sure whether Murdoch's sons, James, 41, and Lachlan, 42, are ready to manage the integration challenge. That's where Carey comes in.
The 60-year-old New Yorker, who's been working for Murdoch since 1988 and earned a reputation for a no-nonsense leadership style, signed a two-year contract with Fox in June that gives him the option to opt out after 18 months. That's raised concern that two years won't be long enough given the complexity of the deal and the likelihood that it may not close until the end of 2015, if not later.
"There is a big push for Carey to stick around to handle the transition if not beyond," said one person familiar with Fox's thinking. "There's no way that after working for 30 years for Rupert and he gets his crowning deal that Carey would bail on him."
The succession issue is important to Time Warner shareholders not only because of concerns about the experience of Murdoch’s sons but also because the way the bid was structured, Time Warner shareholders would have no voting shares: Murdoch controls Fox through a special class of voting stock that is not part of the deal. The deal would be less risky for Time Warner shareholders if Carey were still in the job, said one person familiar with Time Warner.
Fox spokesman Nathaniel Brown declined to comment. Time Warner spokesman Keith Cocozza also declined to comment. Carey didn't respond to a request for comment.
"The reasons people like Carey is he is decisive, he doesn't use words to create obfuscation, he is very direct and extraordinarily candid for a senior executive," said Larry Haverty, a portfolio manager at Gabelli with stakes in Fox and Time Warner.
"If I had to pick between James and Chase I would pick Chase," Haverty said, if the merger happens. On July 16 Time Warner said it rebuffed an $80 billion bid from Fox, including about $85 per share in cash and non-voting stock. Continued...