News Corp set the distribution ratios for the spinoff of its publishing business, which may start buying back stock right away.
The board of the publishing business, which will retain the News Corp name, authorized a $500 million stock repurchase program, the company said on Friday.
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The stock repurchase may shed light for analysts and investors who want to know how the new News Corp will use the $2.6 billion in cash it will have when the spinoff takes place. That is expected to occur on June 28.
Chairman Rupert Murdoch and Chief Executive Officer Robert Thomson will give more details about the company at a conference on May 28.
The board of the existing News Corp has now formally approved the split-up of the company's publishing business from its entertainment operations. Current News Corp stakeholders who own four shares of Class A or Class B common stock will receive one share of new News Corp's Class A or Class B common stock.
To prevent hostile takeovers, News Corp put in place a poison pill provision for one year after the split. It will be triggered if someone acquires more than 15 percent of the stock of either company.
News Corp has a history of potential takeovers. In 2004, Liberty Media Corp's John Malone had quietly snapped up a 20 percent voting stake in the company. The move prompted Murdoch to swap his stake in DirecTV and other assets for Malone's shares in News Corp.
The new News Corp will be an independent publicly traded company.
The entertainment assets, including Fox broadcasting network, movie studio and lucrative equity stakes in pay-TV providers, will be known as 21st Century Fox.
21st Century Fox will retain no ownership interest in News Corp, the company said.
The publishing spinoff includes News Corp's newspapers including The Wall Street Journal and The Times in London, a cable network and pay-TV provider in Australia, book publisher HarperCollins and fledgling education company, Amplify.
The company named current directors Lachlan Murdoch and James Murdoch to the board of the new News Corp. New additions to the board include Thomson; Ana Paula Pessoa, a partner at Brunswick Group; John Elkann, head of Exor SpA; and Masroor Siddiqui, head of investment firm Naya Management.
At 21st Century Fox, new board directors include Delphine Arnault, deputy general manager at Christian Dior Couture; Jacques Nasser of One Equity Partners; and Robert Silberman, executive chairman of Strayer Education Inc.
Rupert Murdoch will be CEO of 21st Century Fox and chairman of both companies.
Shares of News Corp were up 0.8 percent at $33.13.
(Reporting by Jennifer Saba in New York; Editing by Sofina Mirza-Reid, Jeffrey Benkoe and Lisa Von Ahn)