Bancrofts Now Say They’ll Meet Murdoch Over DJ Deal

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By: Mark Fitzgerald

After twice slamming the door on Rupert Murdoch’s $5 billion offer to buy Dow Jones & Co., the controlling Bancroft family late Thursday agreed to discuss the deal with his News Corp.

The Wall Street Journal, in a story by Sarah Ellison, released what it said was a preliminary text of a statement that was still being finalized Thursday evening.

“After a detailed review of the business of Dow Jones and the evolving competitive environment in which it operates, the Family has reached consensus that the mission of Dow Jones may be better accomplished in combination or collaboration with another organization which may include News Corporation,” the statement reads in part.

The far-flung family, which together controls 64% of the voting stake, had previously said members representing 52% of voting shares opposed the Murdoch bid.

But Murdoch’s $60-a-share offer is a 67% premium on the languishing stock’s previous price, and observers had predicted the bid would be too rich to pass up.

Significantly, the Bancrofts appeared to be welcoming a bidding war for the financial publishing and services giant. “The family also indicated its receptivity to other options that might achieve the same overarching objective,” the statement said.

The statement repeated the concerns that individual family members, and the Ottaway family stockholders, expressed about keeping the flagship Wall Street Journal’s editorial independence and integrity under any new ownership.

“Accordingly, the family has advised the company’s board that it intends to meet with News Corporation to determine whether, in the context of the current or any modified News Corporation proposal, it will be possible to ensure the level of commitment to editorial independence, integrity and journalistic freedom that is the hallmark of Dow Jones,” the statement said.

The New York Times reports tonight: “The decision, which represents a remarkable turnaround for both the company and for Mr. Murdoch?s bid, could end more than a century of family control over the company. For much of that time, The Wall Street Journal has been the gold standard in financial journalism….

“According to people close to the family who declined to be identified, the family wants any bidder to meet two conditions. The first is more money, which means that any bidder, including Mr. Murdoch, would have to beat his first offer of $60 a share. Second, and perhaps more important, the family wants an independent overseer to guarantee what it called ‘the editorial independence and integrity of The Wall Street Journal.’

“While the Bancroft family originally came out against Mr. Murdoch?s offer, people close to the family now suggest that its straw poll may have been taken too quickly and did not fully represent the view of the entire family.

“Moreover, some family members who seemed to be Mr. Murdoch?s staunchest opposition, decided, in the end, to consider a sale.”

The full family statement follows.
*

As we have been since 1902, the Bancroft family remains resolute in its commitment to preserve and protect the editorial independence and integrity of The Wall Street Journal as well as the leadership, strength and vitality of The Journal and all of the other publications and services of Dow Jones.

Since first receiving the News Corporation proposal, the family has carefully considered and discussed among ourselves and with our advisers how best to achieve that overarching objective while serving the best interests of the company?s various constituencies.

After a detailed review of the business of Dow Jones and the evolving competitive environment in which it operates, the family has reached consensus that the mission of Dow Jones may be better accomplished in combination or collaboration with another organization, which may include News Corporation.

Accordingly, the family has advised the company?s board that it intends to meet with News Corporation to determine whether, in the context of the current or any modified News Corporation proposal, it will be possible to ensure the level of commitment to editorial independence, integrity and journalistic freedom that is the hallmark of Dow Jones.

The family also indicated its receptivity to other options that might achieve the same overarching objective.

There can be no assurance that the dialogue with News Corporation or any other party will result in the negotiation, or the desire of family members to purse the negotiation, and execution of any agreement regarding the company or in any transaction. References herein to the Bancroft family are to various individual family members and trusts for the benefit of family members. Ultimate voting and dispositive power with respect to the shares of the company held or controlled by such individuals and trusts resides with those individuals and the trustees of the trusts


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