Rupert Murdoch’s News Corporation has boosted the cash dowry for its about-to-be-separated publishing arm by $US1.6 billion from the originally mooted $US1 billion, according to a filing with US authorities late on Friday night. The new News Corp (which will be called News Corp) will start life on its own with a cash pile of $US2.6 billion.

The extra cash will be needed because the company’s outlook is dimming. Revenues remain weak and profits low for the current News Corp. In the section of the SEC Preliminary Proxy Statement about the various business risks the company faces, one point stood out — the comments about Australia. The new News Corp statement said:

“We will have a greater proportional exposure to certain Australian business risks, including specific Australian legal and regulatory risks, consumer preferences and competition because we will hold substantially all of Parent’s former Australian assets, and those Australian assets will represent a greater proportion of our total assets than of Parent’s former total assets. As a result, our results of operations may be adversely affected by negative developments in the Australian market.”

The $US1.6 billion in extra cash is more than twice the $US741 million the publishing division had on hand as of December 31. At that date, the whole News Corp group had $US7.8 billion in cash and cash equivalent. The new News Corp will be getting just over a quarter of that amount. News Corp overall had just over $US16 billion in short- and long-term debt, but the new filing with the US Securities and Exchange Commission had no debt listed for the new News Corp, although it said the company might raise a line of credit before the split occurs.

News Corp’s publishing business will have more than $US18 billion in assets (boosted by the Consolidated Media purchase and revaluation in 2012) and is expected to have pre-tax profits (on an earnings before interest, tax, depreciation and amortisation) of just under $US900 million for the year to June 2013. Hundreds of millions dollars of tax losses will help protect those earnings for a couple of years, but the earnings will mean the company has a lot of assets and very low profitability.

The new News Corp again warned that goodwill of up to $US2.2 billion remained “at risk” because its fair value of reporting units was less than 10% above their book values. Most of these units are in Australia, according to previous statements.

The small, 1% rise in revenue in the six months to December to $US4.5 billion means total sales will be just over $US9 billion for News Corp’s parent company for the full year, with much of the increase coming from the extra revenues from Fox Sports Australia and not the newspapers, which remain under pressure. Nearly half of the company’s revenues came from advertising, which fell 7% in the period compared with the same period the previous year. Around 41% of group revenues came from the US, 32% from Australia and 20% from Britain. In addition newsprint costs rose 5% in the half year and are now above the average per tonne cost of the past five years.

Rupert Murdoch will remain chairman and chief executive of the Fox Group entertainment company and will be chairman of the new News Corp. Robert Thomson, the former managing editor of The Wall Street Journal, will be its chief executive. He will be paid $US2 million in salary, as well as up to $US2 million in bonuses and unquantified performance share awards. The new News Corp said on Friday it was in the process of selecting members for the board of directors for the new company.

The new company won’t have to worry about future costs related to the News of the World and Sun phone hacking and bribery scandals. It said that Fox Group, the entertainment company that will be created after the split, would pay for any settlements and legal expenses and indemnify the new News Corp for “liabilities arising out of civil claims or investigations” as well as “costs and expenses related to the criminal matters”.