Fox Shake-Up: What's Next for Chase Carey?
A clause will keep the exec from taking a job at a competitor until at least mid-2016, but some say he could also take the Peter Chernin route.
21st Century Fox president and COO Chase Carey has been Rupert Murdoch’s right-hand man since 2009.
Known as an astute dealmaker, he is also popular on Wall Street. At Fox, he has long helped hedge against criticism that the Murdoch family is controlling the company, adding a non-family voice in the top leadership ranks.
But on Thursday it emerged that Carey, who is in his early 60s, would leave his current company post next year with James Murdoch set to become CEO and Lachlan Murdoch, currently non-executive chairman, set to become executive co-chairman.
His current employment contract “permits Mr. Carey to elect to conclude his term of employment no earlier than December 31, 2015 after providing six months’ notice to the company, which notice may be given no earlier than July 1, 2015,” according to a regulatory filing. “Should Mr. Carey elect to conclude the term of employment, he agrees to provide non-exclusive consulting services to the company through June 30, 2016. During the consulting term, Mr. Carey would continue to receive the compensation and benefits as set forth in the Carey amended agreement, and Mr. Carey would also be subject to a non-compete provision.”
In other words, Carey has agreed not to compete with 21st Century Fox until after June 30, 2016, or potentially later if he agrees to a possible extended period as an advisor.
Wall Street analysts on Thursday said he could well be in the running for another top management gig in the industry once his current Fox contract ends, if any one opens up, although some also said he may not be in a hurry to go elsewhere given his long relationship with and loyalty to Rupert Murdoch and promise to help shepherd the next generation of leaders at the company. "He is really loyal," said one Wall Street observer who didn't want to be named.
“Chase is well regarded by the Street and given his somewhat unique background —both content and distribution chain, he will probably have no shortage of other opportunities, both public and private,” said S&P Capital IQ analyst Tuna Amobi. He wouldn’t name specific companies that could be interested in Carey.
MoffettNathanson analyst Michael Nathanson in a report also emphasized that Carey has a strong reputation. “The unfortunate outcome of this transition [at Fox] will be that current president and COO Chase Carey will step down to take on a yet undefined advisory role at the company,” he wrote, calling him “well-regarded.” But he added: "I don't see him going anywhere that fast."
Most observers said that it was difficult to predict which companies in the entertainment industry or related sectors would be in need of a top manager next year.
A Wall Street observer who didn’t want to be named said that Carey’s past Fox experience and a six-year stint as CEO of satellite TV giant DirecTV gave him expertise that could be interesting for content or distribution companies, or any company dealing with them.
“He is a very successful and effective guy, and people, by and large, like working with him and for him,” Bill Simon of executive search firm Korn/Ferry tells The Hollywood Reporter. “The challenge is finding something of comparable interest, either intellectually or scale or growth opportunity.”
He adds: “Could he be the senior operating executive of any number of other big diversified media companies? Absolutely. Since he will stay on for a while, will there be other openings coming up over the next year? Statistically, there will be. Could he join some boards? I don’t know if he will have non-competes even in advisory and board roles, but he could serve as a board advisor or director in different kinds of media, entertainment, content, technology, convergence plays out there. He could go work for a private equity firm. There is a range of things that he could do.”
Simon and others on Thursday pointed to former Murdoch right-hand man Peter Chernin who Carey replaced. His Chernin Group, founded in 2009, manages, operates and invests in businesses in the media, entertainment and technology sectors.
“He could even do what Peter Chernin did, create a diversified new-age media company,” Simon said about Carey. “He certainly has all the requisite skills and experience. He has a year to start thinking about it. And I think he will have lots of different opportunities.”
Other top entertainment industry executives have also found new challenges, at times on a smaller scale, according to industry watchers.
Judy McGrath left MTV Networks as chairman and CEO in 2011 after 30 years at the company. In June 2013, she became president of Astronauts Wanted: No Experience Necessary, a digital content joint venture with Sony Music Entertainment. And last year, she was elected to Amazon.com’s board.
Former Viacom CEO Tom Freston, meanwhile, is also keeping busy. His work has included working and consulting with Vice Media and others. “He is doing lots of smaller things, including good-deed and NGO stuff,” says Simon. “It’s on a smaller economic level, but has a bigger scope of issues.”