News Corporation (ASX: NWS) (NASDAQ: NWS) has put out a press release this morning stating they are considering the sale of the News America Marketing business. News Corp investors have responded by sending its share price up 4%, that compares to a 1% rise in the ASX 200 (INDEXASX: XJO). Here’s what you need to know…
About News Corp
News Corp is a global, diversified media company with headquarters in Australia, the US and the UK. Newscorp operates businesses across a range of sectors, including news and information services, subscription video services (Foxtel), book publishing, and digital real estate services.
News Corp announced this morning that it is considering strategies to optimise and simplify the company structure, particularly in regard to its News America Marketing (NAM) business.
According to the press release, these options include exploring a potential sale of the business. This is being done to allow greater focus on News Corp’s primary operations.
NAM has a database of shoppers and purchase data, allowing retailers and brand partners to directly target the consumers that are likely to purchase. The business has in-store marketing media options in more than 60,000 stores in the US and Canada.
News Corp CEO, Robert Thomson, said the NAM business has grown into a “crucial player in the digital evolution of retail media and an innovator in in-store marketing”.
“We believe this strategic review will result in enhanced shareholder value, as we seek to streamline our company, with the aim of greater transparency and profitability,” he said.
Is News Corp a Buy?
The Newscorp share price movement this morning, up around 4.5% at the time of writing, would suggest shareholders are welcoming the strategic review of the NAM business and are open to the idea of a more focused News Corp.
The fact is though, this is a press release and holds no guarantee of a sale of the NAM business, or any guarantee that any changes will be made.
If I were a shareholder, I’d be waiting to receive more information before making any big decisions.
For now, I’d rather invest in one of the high-quality businesses mentioned in the free report below.
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Disclaimer: Any information contained in this article is limited to general financial/investment advice only. The information has not taken into account your specific needs, goals or objectives, so please consider consulting a licenced and trusted adviser before acting on the information. Please read The Rask Group’s Financial Services Guide (FSG) for more information. This article is authorised by Owen Raszkiewicz of The Rask Group, which is a corporate authorised representative No. 1264179 of Strawman Pty Ltd (ACN: 610 908 211) (AFSL: 501 223).
Disclosure: At the time of writing, Max does not own shares in any of the companies mentioned.