Last night, Dow Jones C.E.O. Richard F. Zannino finished a marathon session with News Corp. chairman Rupert Murdoch by hammering out a tentative agreement to sell him the company.
In the negotiations, according to The Wall Street Journal (which is owned by Dow Jones), Mr. Zannino failed to persuade Mr. Murdoch to increase his offering price of $5 billion; but may have won the right to place the beloved recently-departed Journal managing editor Paul Steiger on the board of News Corp.
Efforts to place a member of the Bancroft family, the family that owns controlling “supershares” in Dow Jones, on the News Corp. board failed earlier in the negotiations.
And it looks like the Bancrofts are all that’s left between Mr. Murdoch and ownership of Dow Jones.
The full Dow Jones board could vote on the deal tonight, according to the Journal:
Michael B. Elefante, the Bancroft family’s lead trustee, has scheduled a meeting for Thursday at which he would present the agreement to all Bancroft family members before asking for their final vote. Mr. Elefante is expected to give the family several days to make a decision, suggesting a final resolution could be achieved some time next week.
Apparently, the board will require yet another approval from the Bancrofts. The best details on that are actually in The Financial Times:
If the News Corp offer secures backing from the full board, it would then require approval from members of the Bancroft family, who control 64 per cent of Dow Jones’ voting power.
The family includes about 35 adults, and they do not have to vote their shares as a block. That has led some observers to predict that their deliberations could take a week or longer.
But even after a week, the New York Post (which is owned by Rupert Murdoch’s News Corp.) reports: “Sources close to Dow Jones have little faith that a competing offer will emerge.”
Indeed, there is little reason to believe another offer could stand up to the Dow Jones offer. Efforts by Bancroft family trustees including Christopher Bancroft and Leslie Hall, details of which emerged in yesterday’s papers, all appear to have hit the rocks.
And, to cycle back to the beginning here, the fact that the holdout Bancrofts did not provide enough leverage against Mr. Murdoch to get him to up the price shows how little prospect of a competitive bid seems likely.
All that’s left now is for the Bancrofts to decide to sell to Mr. Murdoch instead of holding on. We’ll keep you posted.