News Corp. May Spin Off Satellite Unit

News Corp., the media company headed by Rupert Murdoch, is considering combining its satellite television businesses and related holdings into a separate company in a bid to boost its stock price.

The new company probably would be publicly traded, a person familiar with the situation said. News Corp. said in a statement that it’s “premature to speculate” on the makeup of the new entity.

News Corp. believes the value of its satellite operations such as Star TV is being overlooked, and some investors have been pushing Murdoch to find a way to highlight them. Shares of other satellite companies such as Hughes Electronics, which owns DirecTV, and EchoStar Communications Corp. have surged in the last year as investors bet that satellites will become more widely used worldwide to transmit TV programming and new digital services, such as high-speed Internet access.

“Look at the huge appreciation in EchoStar, Hughes and British Sky Broadcasting. The time is right to monetize some of these assets,” said Rob Lyon of Institutional Capital Corp., a News Corp. shareholder.

The Wall Street Journal reported Monday that News Corp. would own at least 60% of the new company, with the rest to be owned by strategic partners or the public.

Sydney, Australia-based News Corp., which lacks the widespread cable TV systems of rivals such as Time Warner Inc., is targeting satellite broadcasting as a major distribution system for its TV programming, especially outside the U.S.

A separate public company could help News Corp. remove some of the losses from its own financial results and improve its access to capital, analysts and investors said.