Dow Jones won't sell to Murdoch, but will go to private equity
Peter Cohan, writing on BloggingStocks.com, predicts that the Bancroft family still won’t sell Dow Jones & Co., the parent of The Wall Street Journal, to News Corp. CEO Rupert Murdoch, but will use the talks with him to open a bidding process for the company.
And when Cohan — president of a management consulting and venture capital firm — refers to The Towel, he’s talking about the Journal. That’s his nickname for the paper after its redesign, which he says makes it look like a Holiday Inn bath towel,Â earlier this year.
He wrote, “I think the Bancrofts will definitely sell The Towel but not to Murdoch. Instead, they will pick the buyer which they perceive is most likely to offer editorial independence and the highest price.
“Who else is likely to join the bidding? According to the Times potential bidders for The Towel include Bloomberg L.P., the General Electric Company or the former head of the American International Group, Inc., Maurice R. Greenberg. But my hunch is that a private equity firm would best suit the Bancrofts’ criteria.
“Given his track record of editorial intervention, Murdoch cannot satisfy the first test. So I think the Bancroft’s decision to meet with him simply sets the bidding process in motion.
“Since the news of this meeting leaked last night on The Towel’s web site, private equity firms are no doubt sharpening their spreadsheets. With DJ up 14% — above Murdochs’ $60 a share offer — I would guess that the final offer could go as high as $80 and that the winner will be a private equity firm.”
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