Murdoch reaches 'tentative' deal with Dow Jones

by Staff, Brand Republic 17-Jul-07, 08:45

NEW YORK - Rupert Murdoch has reached a tentative deal to buy Dow Jones for $5bn, with the board of the company meeting this evening to vote on the deal.

According to a report in the Dow Jones-owned Wall Street Journal, an agreement was reached yesterday after talks between Dow Jones chief executive Richard Zannino and Murdoch, who is chairman of News Corp, along with other advisers for both companies.

However, there is still the matter of obtaining approval for the deal from the Bancroft family, which controls 64% of the votes in Dow Jones. The Wall Street Journal reports that "the family's position on the deal is too close to call," according to Zannino.

The family is to meet on Thursday to discuss the offer, ahead of a final vote.

Family members are split on the deal, with some happy to sell to Murdoch, some opposed and some preferring a sale to another party -- although no serious competition to Murdoch's bid has yet emerged. There have been moves to secure an agreement from Murdoch that would guarantee the editorial independence of the Wall Street Journal.

News Corp submitted its unsolicited bid in early May, which valued Dow Jones at $5bn, or $60 a share, representing a 67% takeover premium.

After this bid was rejected, Murdoch stepped up plans to buy the company by offering the Bancroft family seats on the News Corp board, and proposed the creation of an independent editorial board for The Wall Street Journal.

Along with the Wall Street Journal, the company's assets include Dow Jones Newswires and Dow Jones Indexes, Barron's, MarketWatch, the Far Eastern Economic Review, local newspapers and a share of Stoxx, which provides news content to CNBC and radio stations in the US.