Four years after his resignation, James Murdoch will return to UK subscription broadcaster Sky as chairman of the board.
Sky announced Friday that current chairman Nicholas Ferguson will step down from the company board in April.
Mr. Murdoch had been chief executive officer of Sky for four years and chairman for five, but was forced to resign in 2011 after a phone-hacking scandal shook the News of the World newspaper, which was owned by the Murdoch family.
Murdoch returns to Sky as it enters into another prosperous business year, spurred by acquisitions in Germany, Italy, Austria, and Ireland that have turned the company into a pan-European broadcasting giant. His newly reaffirmed position at the head of the company indicated a future sale to 21st Century Fox.
“As an investor in 21st Century Fox as well, we always consider it a real possibility for Fox to fully take over Sky at some point," Jeff Li, co-fund manager at EFG Asset Management, told Reuters.
Ties between James Murdoch and 21st Century Fox, the global media company owned by his father, run deep.
In 2011, with James Murdoch in control of Sky, Fox offered an £8 billion bid to acquire full control, according to The Guardian. The deal fell apart after Mr. Murdoch resigned from Sky and several of the Murdoch newspaper assets were shaken by the phone-hacking scandal.
After his resignation, 21st Century Fox was instrumental in Murdoch’s corporate rehabilitation. Murdoch left Britain, where his name was associated with the scandal, and worked in New York. In 2015, Murdoch was named chief executive of the global media company.
During his tenure as chief executive of Fox, James Murdoch himself predicted the company would take a controlling portion of Sky News. Following the sale of Fox assets in Germany and Italy to Sky, Murdoch stated:
That integration is going really well. The company is moving at a very fast pace and has grown in value enormously. We’ve also been clear that over time, having 40 percent of an unconsolidated asset is not an end state that is natural for us.
21st Century Fox currently owns 39 percent of Sky, according to MarketWatch.
With a takeover from Fox seemingly inevitable, the decision to place James Murdoch back on the Sky board has prompted mixed feelings from investors.
Ashely Hamilton Claxton, corporate governance manager of RLAM, who has shares in Sky, told Reuters, "Should Fox make a bid for Sky, investors need a strong independent chairman to protect the interests of minority shareholders and negotiate the best possible deal.”
On the other end, Mr. Li, from EFG Asset Management, explained to Reuters that James Murdoch has the desired amount of experience and shareholders are likely to welcome his return.
The Board of Sky appears to agree with Li. James Murdoch was the only candidate suggested to take over after Ferguson steps down and received a unanimous vote of approval.
Sky beat analysts expectations for operating profit by £20 million over the last six months, in line with a 12 percent year-over-year increase. Revenue has risen 5 percent and the broadcasting company has gained over 337,000 new customers, according MarketWatch.
"James' deep knowledge of the international media industry and his passion for supporting Sky's ongoing success will make an even greater contribution to our business in the future," Chief Executive Jeremy Darroch told The Washington Post.