Business | General
News Corp and Dow Jones 'strike tentative $5b deal'
Dow Jones Chief Executive Richard Zannino tentatively agreed on Monday to a $5 billion takeover bid by News Corp, though the company's controlling Bancroft family remains divided on the deal, the Wall Street Journal reported.
- Reuters
- Published: 23:20 July 17, 2007
New York: Dow Jones Chief Executive Richard Zannino tentatively agreed on Monday to a $5 billion takeover bid by News Corp, though the company's controlling Bancroft family remains divided on the deal, the Wall Street Journal reported.
The agreement in principle was expected to go before the full Dow Jones board late yesterday, said the newspaper, which is Dow Jones' flagship publication and the asset most coveted by News Corp Chairman and Chief Executive Rupert Murdoch.
Michael Elefante, the Bancroft family's lead trustee, has scheduled a meeting for tomorrow to present the agreement to all Bancroft family members before asking for their final vote, the Journal said on its website.
Elefante is expected to give the family several days to make a decision, suggesting a final resolution could be achieved next week, it added.
Representatives for the Bancrofts and News Corp, owner of Fox News, the New York Post and a sprawling global media empire, declined to comment. A Dow Jones spokes-woman also declined to comment, while several top executives declined to comment or did not respond to messages seeking comment.
The Bancroft family controls 64 per cent of Dow Jones's voting power and has been divided over Murdoch's bid.
Some Bancrofts - as well as many Dow Jones reporters and editors - had opposed the offer because they think Murdoch would interfere with the company's news operations to benefit his business interests.
Attraction
Other members of the family, along with many ordinary shareholders, were attracted by the $60-per-share price that News Corp offered, which was a 65 per cent premium to Dow Jones' market price when the deal was announced.
The Wall Street Journal said Zannino indicated to News Corp that the Bancroft family's position on the deal is too close to call, citing a person who spoke to him.
Bancrofts who oppose the bid also have the support of former Dow Jones executive and board member Jim Ottaway Jr., who controls his family's 6.2 per cent of the company's voting shares.
"If a sufficient number of Ottaways plus Bancroft people don't accept the deal, then I suppose there's a possibility that it won't happen," said Alan Mutter, a former editor at the Chicago Sun-Times and San Francisco Chronicle, who comments on journalism issues at his blog Reflections of a Newsosaur.
Nonetheless, negotiators from Dow Jones - including Zannino, company advisers and two independent directors - agreed to News Corp's price in principle on Monday afternoon, the Journal said.
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