Dow Jones/News Corp. deal unlikely to succeed

The M&A Researcher writes that the proposed $5 billion acquisition of Dow Jones & Co., the parent of The Wall Street Journal, Barron’s and Marketwatch, by News Corp. is unlikely to happen.

The Researcher wrote, “It is fairly obvious that DJ is employing tactics which are intended to draw a more attractive offer from NWS or, perhaps more desirable, dissuade NWS from continuing its pursuit of the company. If nothing else, DJ and its complex ownership have shown that its interest to be acquired outright is very low and that the alternatives to a DJ-NWS combination — which include no major action at all — perfectly acceptable and strategically rational. Whether this includes some form of agreement with Greenspan and partners remains to be seen.

“In short, this continues to be viewed as a situation in which it is entirely possible that the end result will be absolutely no transaction involving DJ. This is, of course, a somewhat tentative projection given the current activity, but the overall scenario is indicative of a company that is simply going through the necessary steps to remain independent.

“It is therefore currently anticipated that DJ will entertain Greenspan and Co’s proposition, before politely rejecting it, and will in turn take similar action with respect to the current NWS offer. It is uncertain at this point if NWS is inclined to significantly increase its offer, but the general impression is that the company probably will not go much higher given the myriad of circumstances involved.”

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