Rupert Murdoch lined up enough shares Tuesday to acquire Dow Jones & Co., the publisher of The Wall Street Journal.
The News Corp. board voted to approve the $5 billion buyout Tuesday, following reports that Denver-based trusts controlling 9.1 percent of Dow Jones shares swung their support Tuesday afternoon to Murdoch’s bid of $60 a share, pushing it over the top.
Early today, Dow Jones said it had entered into a definitive agreement to be bought by Murdoch’s News Corp. media conglomerate.
So what does it mean for the world’s most respected financial publication to come under the umbrella of a company known for its splashy tabloids, Fox News and the Simpsons?
After spending $5 billion for a company whose worth lies more in its reputation than its earnings power, Murdoch can be expected to tread lightly, newspaper-industry analyst John Morton said.
“He won’t make dramatic changes to the Journal. What you need to worry about is what the Journal doesn’t do,” he said.
Coverage of thorny topics such as human-rights abuses or unfair trade practices in China, for example, could fade away, Morton said.
Denver readers said they are expecting only minimal changes.
H. David Lansdowne, director of wealth management with Denver Investment Advisors, said he was hopeful that the newspaper would continue to pursue the quality journalism that made it famous.
“I’m sure it has been quite a trying experience for the Bancroft family, given the integrity and the great history of Dow Jones,” Lansdowne said, referring to the family that controls 64 percent of voting shares in the company. “I’m hoping that the original independence will continue.”
Longtime Denver reader Jack Deverreaux Jr., an executive with Bank of the West, said he would keep reading.
“The Journal has been dominant for many years,” he said. “I think people will stick with it because we are all creatures of habit.”
After fighting the buyout for weeks, including trying to arrange an alternative deal, the union representing more than 2,000 Dow Jones workers expressed disappointment in Bancroft family members who agreed to sell, while lauding those who stood firm.
“We were heartened that several prominent Bancroft family members remain opposed to the sale on the grounds that it will irreparably damage the quality and independence of The Wall Street Journal and all Dow Jones publications,” said Steve Yount, president of Independent Association of Publishers’ Employees Local 1096.
Although workers are fearful, News Corp. can infuse Dow Jones with capital, build its global presence and help the company transition to the digital age, Morton said.
Murdoch has built his global media empire from a handful of Australian newspapers to include Twentieth Century Fox movie studios, Fox News Channel and a global satellite and television network. News Corp. also owns social-networking site MySpace.
News Corp.’s purchase of Dow Jones seemed at risk of falling apart Monday until a group of Denver trusts, overseen by Holme Roberts & Owen partners Lynn Hendrix and Charles Ramunno, agreed Tuesday afternoon to the sale, according to The New York Times and other news outlets.
Neither Hendrix or Ramunno returned calls seeking comment. News Corp., Dow Jones and the Bancroft family also didn’t officially confirm media reports suggesting Murdoch had cinched the deal.
Staff writer Aldo Svaldi can be reached at 303-954-1410 or asvaldi@denverpost.com.
Dow Jones’ holdings
Consumer Media Group
Local Media
Enterprise Media (electronic news services)
Sources: Dow Jones, Hoover’s, Denver Post archives
News Corp.’s holdings
Television
Film
Newspapers
Publishing
Online
Sources: Hoover’s, News Corp., Denver Post archives
