OLD Media Moves

Dow Jones to sell stake in stock index business

November 12, 2009

Dennis Berman and Jeffrey McCracken of The Wall Street Journal report Thursday that Dow Jones & Co., the parent of the Journal, is about to sell its position in the Stoxx Ltd. stock index business for $309 million.

Berman and McCracken write, “Under the terms of the deal, Deutsche Börse and SIX Group will each control half of Stoxx Ltd., with Deutsche Börse holding slight majority control over the reorganized venture. Dow Jones will also receive an ‘earn-out,’ which will allow it to earn as much as $44 million if the business performs well under the new structure.

“A deal could be announced as early as Thursday, people familiar with the matter said.

“Dow Jones has in recent months been giving a thorough review of its index business. The unit contributes about $90 million in annual revenue to Dow Jones, according to people familiar with the matter. Its most famous product is the 113-year-old Dow Jones Industrial Average, but it also calculates thousands of different indexes used as the basis for investment products. Dow Jones, publisher of the Wall Street Journal, is owned by News Corp.

“The indexes business has been a relatively stable and profitable unit for Dow Jones amid a period of revenue decline in its core newspaper franchise.”

Read more here.

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