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News Corp. Makes Surprise Bid for Dow Jones

May 1, 2007  •  Post A Comment

News Corp. made a rich, unsolicited offer to acquire Wall Street Journal parent Dow Jones and Co.
Dow Jones’s global brand as a purveyor of business news and information on traditional and new media platforms would be an immediate boost to News Corp.’s plans to launch the Fox Business Channel this year. It also would strengthen News Corp.’s Internet holdings, which include MySpace.
According to the Wall Street Journal, the News Corp. offer is worth some $5 billion, and the $60 per share beats recent evaluations of the stock price by 67 percent. The offer sent Dow Jones shares soaring until trading was halted.
After the stock market closed, the Bancroft family, which controls Dow Jones, said it would reject News Corp.’s bid. The family controls a little more than 50 percent of the voting stock in the company. The Bancroft family did not comment on whether it would accept any other offers.
A successful acquisition could complicate life for NBC Universal-owned CNBC, which has a content relationship with Dow Jones and is girding for competition from the Fox Business Channel.
According to a statement from Dow Jones Tuesday morning, News Corp. is offering to acquire all outstanding common stock for $60 per chare in cash or a combination of cash and News Corp. securities.
In addition to The Wall Street Journal, Barron’s, MarketWatch and the Far Eastern Economic Review, Dow Jones also owns Dow Jones Newswires, Factiva, Dow Jones Licensing Services, Dow Jones Indexes and Dow Jones Financial Information Services. Its local media group operates community-based information franchises. Dow Jones owns 50% of SmartMoney and 33% of Stoxx Ltd.
(Editor: Baumann)

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