By: E&P Staff and The Associated Press
A British financial magazine reported today that Rupert Murdoch’s News Corp. had agreed on terms for its $5 billion bid for Dow Jones & Co. Inc.. But Dow Jones now denies that deal, while confirming talks go on.
A Dow Jones spokesperson told E&P at 10:30 this morning that the report was “incorrect” and said a full statement was coming.
“The only agreement is on editorial independence,” said Andrea Grinbaum, a spokeswoman.
Reuters reported at 10 a.m. ET that News Corp. “has not yet reached a deal to buy Dow Jones & Co. Inc. as discussions continue over such issues as price, a source familiar with the matter said on Friday.
“A Dow Jones spokesman said a report in London’s The Business weekly magazine that said the two sides have completed talks citing an unnamed sources acting for the Dow Jones board was incorrect.”
Steve Yount, president of the union local that represents Dow Jones employees, tells E&P, “There’s no deal until the family signs off– and they haven’t. It seems to me that the board has always been more interested than the Family in doing a deal with News Corp.”
The Business report said that sources acting for the Dow Jones board said that negotiations on the deal have been completed and that the board is confident it will be accepted by the Bancroft family, which has a majority stake in Dow Jones, over the next few days.
The report, written by Andrew Neil, a former Murdoch lieutenant and the chief executive of Press Holdings Media Group, which owns The Business, said that the deal was delayed until agreement was reached on a legally enforceable undertaking by Murdoch to “preserve the Wall Street Journal’s editorial independence.”
News Corp. would pay $60 a share for Dow Jones stock, a 67 percent premium on the $36 a share price in April before news of the bid leaked, the magazine said.
The Business said that a formal announcement on the deal is expected next week.
It stated: “Murdoch and Dow Jones will jointly agree the membership of this [editorial] panel, which will have the power to choose its successors?a crucial concession to the Bancrofts who are sensitive to the claim that they are sacrificing the Journal?s editorial integrity by selling to Murdoch. The Bancrofts have received extensive legal advice in an attempt to satisfy themselves about the durability of the editorial safeguards.
“The arrangement is a tougher version of the one put in place by the British government when Murdoch bought The Times and The Sunday Times in 1981. Murdoch will have less control over the independent directors at the Journal than he does at Times Newspapers, where they are regarded as weak and ineffectual. But one source, acting for the Bancrofts, admitted privately that the Dow independent panel was only a ‘fig leaf’ to facilitate the sale and that over time Murdoch would get round it.”