Fox News and Glenn Beck have announced a new deal -- one that will see Beck's slumping 5 p.m. show end later this year.

In a carefully-worded statement, Fox News and Mercury Radio Arts, Beck’s production company, announced that they "will work together to develop and produce a variety of television projects for air on the Fox News Channel as well as content for other platforms including Fox News' digital properties."

But "Glenn intends to transition off of his daily program, the third highest rated in all of cable news, later this year."

“I truly believe that America owes a lot to Roger Ailes and Fox News," Beck said in a statement. "I cannot repay Roger for the lessons I’ve learned and will continue to learn from him and I look forward to starting this new phase of our partnership."

Ailes, called Beck "a powerful communicator, a creative entrepreneur and a true success by anybody’s standards. I look forward to continuing to work with him."

As part of Beck's new deal with Fox, Joel Cheatwood -- senior vice president of development and one of Beck's soldiers inside of Fox News -- will be jump to Mercury Radio Arts (effective April 24) as an executive vice president. There, Cheatwood "will manage the partnership and serve as a liaison with Fox News."

Also read: His Ratings Fizzling, Has Glenn Beck Lost His Mojo? [5]

Rumors have been swirling about Beck's television contract with Fox for months -- and his ratings have been fizzling much longer. Through March 1, Beck's show was down 35 percent in total viewers in 2011 (averaging 1.9 million over the first seven weeks, compared to 2.93 million last year) and 44 percent in the 25-to-54-year-old demographic (447,000 vs. 793,000 a year ago). Through March, Beck was down 30 percent in total viewers, and 37 percent among 25-to-54-year-olds. And it's seen nine consecutive month-over-month declines in total viewers, and seven among 25-to-54-year-olds.

Beck's ratings slump has been caused by a combination of factors, including a post-election hangover, a cyclical shift to harder news and his absurd views (even for conservatives) on Egypt and the Middle East.

“There are a myriad of factors that impact month-to-month viewing from news cycles to vacations, weather,” Cheatwood told TheWrap last month. “It's a long list.”

Politics may be at the top of that list.

“Last year was a political year,” TVNewser [6] editor Alex Weprin said. “With the midterm elections looming in November, cable news was obsessed with reading the tea leaves.” It was also the year of the Tea Party, “which Beck made a major part of his shows,” culminating in his “Restoring Honor” that drew close to 100,000 people [7] to the Lincoln Memorial in Washington last August.

But this year, hard news -- and particularly in the Middle East -- has been the focus of cable news programming, including on Beck's show. “Beck is at his best when he is talking politics, not when he is talking about the situation in Libya,” Weprin said.

Despite the slump, Beck's show by far was the highest rated among his cable competitors at 5 p.m. Through March, Beck's show averaged 1,939,000 total viewers -- good enough for third place behind FNC's Bill O'Reilly and Sean Hannity -- and 462,000 25-to-54-year-olds -- or fourth place behind O'Reilly, Hannity and Shepard Smith.

Fox News did not announce who Beck's replacement in that slot would be, but according to one high-placed source, the favorite inside the network appears to be Judge Andrew Napolitano, who filled admirably last month while Beck was on vacation [8].

See also: Glenn Beck's Fill-In on Fox News Draws the Same Audience as Glenn Beck [8]

Two weeks ago on his radio show, Beck sounded like his bags were already packed.

"The only thing in life that is constant is change," he told listeners [9]. "And so while things, and I don’t know which, will change, all things do, but I know that we’ll continue to find each other whether on the radio, the Internet, on stage, in movie theatres, in the pages of books that the New York elite will never read or on Fox that the New York elite will never watch."

[10]

Here's the full Fox News release:

FOX NEWS AND MERCURY RADIO ARTS ANNOUNCE NEW AGREEMENT

NEW YORK -- FOX News and Mercury Radio Arts, Glenn Beck’s production company, are proud to announce that they will work together to develop and produce a variety of television projects for air on the FOX News Channel (FNC) as well as content for other platforms including FOX News' digital properties. Glenn intends to transition off of his daily program, the third highest rated in all of cable news, later this year.

Roger Ailes, Chairman and CEO of FOX News said, “Glenn Beck is a powerful
communicator, a creative entrepreneur and a true success by anybody’s standards. I look forward to continuing to work with him."

Glenn Beck said, “I truly believe that America owes a lot to Roger Ailes and FOX News.
I cannot repay Roger for the lessons I’ve learned and will continue to learn from him and I look forward to starting this new phase of our partnership."

Joel Cheatwood, SVP/Development at FOX News, will be joining Mercury Radio Arts effective April 24, 2011. Part of his role as EVP will be to manage the partnership and
serve as a liaison with FOX News.

Ailes said, “Joel is a good friend and one of the most talented and creative executives in the business. Over the past four years I have consistently valued his input and advice and that will not stop as we work with him in his new role."

"Glenn Beck" is consistently the third highest rated program on cable news. For the 27
months that “Glenn Beck” has aired on FOX News, the program has averaged more than 2.2 million total viewers and 563,000 viewers 25-54 years old, numbers normally associated with shows airing in primetime, not at 5pm. “Glenn Beck" has dominated all of its cable news competitors since launch.