News Corp share price up, avoids prosecution over UK hacking

News Corp and Twenty-First Century Fox will not be prosecuted by the US Department of Justice over phone hacking and alleged bribery of public officials in the UK.

Both of Rupert Murdochs companies said in a separate fillings with the Securities and Exchange Commission that the department has completed and closed its investigation over the hacking of private voice-mail messages and the alleged illegal payments to public officials to ensure exclusive news newspaper stories in 2011.

However, the investigation was looking to discover if any of those activities had taken place in the US and the companies warned that the department could re-open the case if new evidence arises.

At the time of the scandal News Corp and Twenty-First Century Fox were under the same roof, so both companies had to be investigated. However, the focus was on New Corps News of the World and The Sun tabloids.

Journalists from News of the World were prosecuted and convicted by UK authorities, after it was found they have hacked into the voice-mail of Milly Dowler, a missing school girl who had been murdered. Additionally, several executives resigned from their posts.

After the scandal News Corp closed News of the World and paid around $551 million in order to cover settlements and legal fees. The company also gave up on its $13.2 billion takeover bid on British Sky Broadcasting Group.

Rupert Murdoch among other executives at News Corp were called for questioning in front of a UK parliamentary committee over their knowledge on the journalists actions.

The newspapers were also accused of paying bribes to public officials in order to gain early access to important news. The department was investigating whether those alleged actions fell under the Foreign Corrupt Practices Act, which forbids bribery of foreign officials.

News Corp and Twenty-First Century Fox split in 2013 creating two separate companies, one focused on news coverage, while the other centered around entertainment.

“We are grateful that this matter has been concluded and acknowledge the fairness and professionalism of the Department of Justice throughout this investigation,” Gerson Zweifach, general counsel of both companies said in a statement.

News Corp gained 0.34% on Monday and closed at $14.94 on the NASDAQ, marking a one-year decrease of 6.39%. The company is valued at $8.55 billion.

According to the Financial Times, the 9 analysts offering 12-month price targets for News Corp have a median target of $18.00, with a high estimate of $21.00 and a low estimate of $16.70. The median estimate represents a 20.48% increase from the last close price.