Media industry insiders buzzed over the possibility of palace intrigue at News Corp. after CEO Rupert Murdoch's oldest son and heir apparent, Lachlan, said on Friday he'll resign on Aug. 31 to return to Australia with his wife and son.
Media mogul Rupert Murdoch (L) and his eldest son Lachlan (R), who last week resigned from the family's News Corporation, have denied reports the departure is related to a dispute over inheritances, reports say.
Lachlan Murdoch - a 33-year-old Princeton graduate known for his good looks, a prominent tattoo on his left forearm and his marriage to a Sports Illustrated swimsuit model - said he'll remain on News Corp.'s board and serve as a consultant.
The elder Murdoch said in a statement that he is "saddened" by his son's unexpected decision to step down.
As a practical matter, though, Lachlan's departure will have a "minimal impact" on the company, Merrill Lynch analyst Jessica Reif Cohen says.
Lachlan Murdoch is deputy chief operating officer and reports to his father. But the elder Murdoch depends heavily on COO Peter Chernin to run key operations at the global film, TV programming and publishing empire, which generated an estimated $23.7 billion in revenue in the fiscal year ended in June.
Lachlan oversees slower-growing units, including Fox's 35 television stations and book publisher HarperCollins. He's probably best known for his work as publisher of the feisty New York Post tabloid
Still, his decision to leave reignited speculation over whether BSkyB CEO James Murdoch, 32, or Elisabeth Murdoch, 36, who runs a London-based production company called Shine, might now be groomed to take over when Rupert, 74, gives up the reins.
James "should eventually take control, but not until Mr. Chernin decides to leave the company and/or the board deems him 'ready,' " Cohen wrote in a report.
Others say it's too early to count Lachlan out.
"One of the benefits of being a Murdoch at News Corp. is that the option of succession is always open to you," says UBS Investment Research's Aryeh Bourkoff.
Many investors started to lose confidence in Lachlan after 2001 when he made a big investment in an Australia telecom company that collapsed. He was caught in another embarrassing snafu when the Post reported on its front page that Democratic presidential candidate John Kerry had chosen Dick Gephardt as his running mate. Kerry picked John Edwards.