Media Moves

Details of Murdoch's letter to Dow Jones board emerge

May 2, 2007

Posted by Chris Roush

Wall Street Journal reporters Dennis Berman and Sarah Ellison had details Wednesday of the letter that News Corp. CEO Rupert Murdoch sent to the Dow Jones & Co. board about his plans for the owner of The Journal, Barron’s and Marketwatch should his $5 billion offer be accepted.

Rupert MurdochBerman and Ellison wrote, “The vision he laid out in the letter was one in which Dow Jones’s content would feed News Corp.’s nascent TV business channel, while also pumping through the rest of its extensive media properties around the globe. The letter made no mention of cost cuts and suggested that News Corp. was prepared to put significant capital into the company.

“Financial news, Mr. Murdoch wrote, was the fastest growing segment of ‘an otherwise languishing publishing industry.’ He noted that he understood ‘the challenges of transitioning into a digital future,’ while saying he wanted to extend Dow Jones’s print and online businesses across the U.S. and abroad. Combining the two companies would provide ‘a digital platform upon which Dow Jones’ management and employees can build,’ he said.

“Of particular note, Mr. Murdoch’s letter said he was prepared to structure a deal in a number of different ways. They could include the issuing of Class A News Corp. shares; a new class of convertible shares in News Corp.; or potentially another security that would be issued on a tax-free basis that would pay out an attractive dividend. Mr. Murdoch said his company’s board had endorsed the offer ‘enthusiastically.’ He offered to set up safeguards to ensure the Journal’s editorial independence through, for instance, creation of a separate board.”

Read more here. Their story states that the Dow Jones board will make a decision on the offer at its Friday meeting.

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