News Corp looks to cut back in China

The deal would see China Media Capital acquire a controlling stake in News Corp's Xing Kong, Xing Kong International and Channel (V) Mainland China channels, along with its Fortune Star Chinese movie library, News Corp said in a statement.

Established in 2009, China Media Capital is a private equity fund with 5bn yuan (463m) in assets under management and a focus on investments in the media industry.

It is backed by Shanghai Media Group (SMG), China's No 2 media company and the dominant player in Shanghai, as well as China Development Bank and China Broadband Capital.

The move could mark the beginning of a wind down for News Corp in China's tightly controlled media market, which has proved highly frustrating to the company and its Western peers after numerous limitations and restrictions by Beijing.

The terms of the deal were not disclosed, but the three channels combined were generating no more than $50m annually in revenue at the time of the deal, said Vivek Couto, a media analyst at Media Partners Asia.

News Corp and global rivals like Time Warner Inc and Viacom Inc held out great hopes for China when they launched TV channels there starting in the late 1990s, hoping to attract mass audiences in a nation with 1.3 billion potential viewers.

But their efforts have been met largely with disappointment, as China has limited their mass distribution largely to the southern province of Guangdong and strictly limited their ability to attract audiences in other parts of the country.