Dow Jones & Co., the parent of The Wall Street Journal, Barron’s, Marketwatch and Dow Jones Newswires, announced late Tuesday that its board “has determined that it would be prepared to approve, and recommend to the Dow Jones stockholders, including the Bancroft Family stockholders,” an agreement to sell the company to News Corp. for $5 billion.Â
“As part of its process, the Dow Jones Board of Directors reviewed the basic terms of drafts of a merger agreement and an editorial agreement negotiated by Dow Jones and News Corporation, with the participation of representatives of the Bancroft Family. The draft merger agreement contemplates that the Dow Jones stockholders would be given the opportunity to elect, with respect to a limited number of Dow Jones shares and up to a limited number of stockholders, to receive equity securities in a News Corporation subsidiary that will hold Dow Jones. These equity securities would be exchangeable for shares of Class A common stock of News Corporation with a value as of closing of $60.
“The Dow Jones Board of Directors also reviewed the terms of a draft voting agreement negotiated between representatives of the Bancroft Family and News Corporation under which members of the Bancroft Family and the trustees of trusts for their benefit would commit to vote their shares of Dow Jones stock in favor of a merger with News Corporation.
“Michael B. Elefante, a representative of the Bancroft Family and a director of Dow Jones, has informed the Dow Jones Board of Directors that members of the Bancroft Family and trustees of trusts for their benefit are evaluating the proposed transaction with News Corporation. There can, of course, be no assurance that a level of Bancroft Family support satisfactory to News Corporation will be obtained.”
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Could Bancroft family ties really be the deciding factor in this deal? The rest of the Dow Jones board seems ready to sign off with this acquisition, yet it looks like the Bancroft goal is to keep it all in the family, despite seemingly everyone else suggesting otherwise. NewsVisual has an interesting article up right now that does a pretty good job at breaking down DJ's board (and why or why not certain members are for or against this bid). I'd be interested to know more about the official Bancroft response that they're worried about NewsCorp's impact on the Wall Street Journal- valid or just for show? BTW, here's the link to NewsVisual's article mentioned above: http://newsvisual.com/