Despite the phone-hacking crisis, the forced closure of the News of the World, the abandonment of the BSkyB deal and an on-going parliamentary and police investigation into the Murdoch's empire, it has been revealed by The Guardian newspaper that both James and Rupert Murdoch could be in line for huge bonuses based on their year-to-June performances.
James and Rupert Murdoch are in line for multimillion-dollar bonuses, with Rupert Murdoch set to receive a $25M bonus on top of his reported $8M salary and his son, James, set for a $12M bonus on top of his reported $3M-a-year salary. The bonuses are based on financial and operating performances and in part by "quantitative factors" of the individual.
There is no indication that the Murdochs will take the bonus, but there is growing public anger that their performances are being judged so favorably despite the ongoing investigation into phone-hacking both in the UK and the U.S.
It has also been revealed that James Murdoch is likely to remain BSkyB head for now, after winning the backing of Sky Chairman Nicholas Ferguson. The chairman of the broadcasting company has been given the full support of Ferguson and the rest of the board, and the company will now move ahead with James Murdoch at the helm.
James' chances of remaining chairman recovered last week following a cool-headed Select Committee performance. However, new claims by Colin Myler, the former editor ofNews of the World, and Tom Crone, its former head of legal affairs, that Murdoch had been "mistaken" in his evidence to MPs again put his position in question. Murdoch has strongly rejected those claims.
It was believed that some investors had requested James resign from his post so that he could deal with the ongoing parliamentary and criminal investigations into his handling of the crisis. With criminal as well as parliamentary investigations into News Corp. International's response to the crisis and the executives involved, BSkyB is unlikely to launch its own inquiry. The board of Sky, which comprises eight non-executives out of a total of 14 who are independent of News Corp., including Ferguson, is to meet on Thursday ahead of the company's annual results the following day.
Expectations are now mounting that BSkyB will issue a special dividend to shareholders following the collapse of its deal talks with News Corp. Analysts say it could issue 80p without recourse to any additional debt, and shareholders could receive as much as 150p a share based on a relatively modest multiple of two times earnings before tax, depreciation and amortization.