21st Century Fox appoints Lachlan Murdoch non-executive co-chairman with Reuters

Media and entertainment company Twenty-First Century Fox Inc said its board has appointed Lachlan Murdoch non-executive co-chairman and elevated James Murdoch to the position of co-chief operating officer.

Lachlan, son of Chief Executive Rupert Murdoch, will work closely with the senior management to develop global strategies and guiding the overall corporate agenda, the company said on Wednesday.

Succession planning at News Corp has taken decades, with all three of the children from Rupert Murdoch's second marriage thought of as the likely successor at one point.

Wednesday's announcement that James Murdoch was a clear indicator of which direction their father Rupert wants the business to go: James to effectively run the business, and Australia-based Lachlan to act as chairman.

Yet this boardroom battle may have another act to play out. James has not made it to chief executive of Twenty-First Century Fox, the television and film assets of the old News Corp., yet.

Chase Carey, the deputy chairman of News Corp,and the man credited with much of Fox's success, has been tipped as successor to Rupert Murdoch by Murdoch himself in the past.

(Read more: Fox shareholder surged to vote against Murdoch)

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"In this elevated role, Lachlan will help us lead News Corp forward as we expand our reach and invest in new technologies and markets around the world," Rupert said in a statement.

Seven years ago, Lachlan Murdoch turned his back on the business his grandfather founded, quitting his role as deputy chief operating officer after banging heads with his father and the top lieutenants.

Since then, he has been focusing on his business interests in Australia through his private investment company Illyria Pty, which owns various media assets. He also owns about 9 percent of Australia's third-ranked TV network, Ten Network Holdings Ltd.

Lachlan, aged 42, is currently a director at Twenty-First Century Fox and News Corp.

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Reuters contributed to this report.