SHANGHAI -- The News Corporation said Monday that it would sell a controlling stake in three Chinese television stations and a movie library to a private equity fund that was formed with the backing of the Chinese government.
The sale of the units is the latest indication that the News Corporation, which is controlled by Rupert Murdoch, is pulling back from China after years of frustration over government restrictions that prevent foreign media organizations from freely operating in a market dominated by state-run companies.
Disney, Time Warner, Viacom and other global media giants have also struggled to break into China's tightly controlled television and media market and have largely been forced to distribute content through government-run media outlets.
The News Corporation, which owns 20th Century Fox Film, the Fox network, HarperCollins and The Wall Street Journal, said in a statement on Monday that it would sell a majority stake in the properties to China Media Capital, a fund set up partly by the Shanghai Media Group, one of the country's biggest state-owned media companies.
China Media Capital will take a majority stake in several of News Corporation's Star China properties -- Xing Kong, Xing Kong International, Channel V and the Fortune Star Chinese movie library -- and form a joint venture with the News Corporation.
According to a person with knowledge of the deal, the majority stake in the three TV properties and the movie library was valued at close to $150 million, a small amount for the News Corporation, which has annual revenue of about $32 billion.
The decision to give up control of the music and entertainment channels and the movie library, which has about 750 Chinese language titles, came a year after the company revamped its television operations in Asia.
Analysts said the News Corporation had been retrenching in China for some years. In 2006, for instance, the company sold a 19.9 percent share in Phoenix Satellite TV to China Mobile, the state-owned telecom giant, significantly reducing Star TV's stake in the venture.
Speaking of the Monday announcement, Vivek Couto, a director of Media Partners Asia, said, ''It was a cold hard decision.'' He continued, ''They decided they want to get value for the business and the only way to do that is to sell to a local partner.''
The joint venture is the first deal for China Media Capital, a $732 million fund that was formed in 2009 with investments from the Shanghai Media Group and the China Development Bank.
In a statement released Monday, James Murdoch, chairman and chief executive of News Corporation Europe and Asia, said: ''The agreement with C.M.C. recognizes the value we have created in Star China and enables us to continue to grow it for the future.''
Analysts say the Shanghai Media Group, which was the driving force in forming the China Media Capital fund, could help strengthen the News Corporation properties and later help China Media Capital spin them off in a public stock offering.
Jack Gao, a vice president at News Corporation and the chief executive of Star China, will become chief executive of the joint venture company.
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