Floyd Norris of the New York Times writes Monday that a minority of the Bancroft family members could block Dow Jones & Co.‘s sale to News Corp. He projects it could happen if there are Bancroft family members owning 9.1 percent of the Class B shares who refuse to sell the owner of The Wall Street Journal.
Norris wrote, “But could a family minority block such a sale? Under certain circumstances it is possible, because of the nature of the super-voting stock that Dow Jones has, for a family minority to obtain a veto when the rest of the family decides to sell.
“‘Unlike some controlling shareholders, the Bancrofts cannot sell control,’ said Jeffrey Gordon, a professor at Columbia University Law School who has written extensively on dual class ownership of shares. ‘This raises the possibility that a minority of the family could block the sale.’
“Under Dow Jones rules, Class B shares have 10 votes per share, while Class A shares, the ones traded on the New York Stock Exchange, have but one vote. But when Class B shares are sold, they become Class A shares, and lose their special voting rights.”
OLD Media Moves
Minority of Bancrofts could block sale
June 4, 2007
Posted by Chris Roush
Floyd Norris of the New York Times writes Monday that a minority of the Bancroft family members could block Dow Jones & Co.‘s sale to News Corp. He projects it could happen if there are Bancroft family members owning 9.1 percent of the Class B shares who refuse to sell the owner of The Wall Street Journal.
Norris wrote, “But could a family minority block such a sale? Under certain circumstances it is possible, because of the nature of the super-voting stock that Dow Jones has, for a family minority to obtain a veto when the rest of the family decides to sell.
“‘Unlike some controlling shareholders, the Bancrofts cannot sell control,’ said Jeffrey Gordon, a professor at Columbia University Law School who has written extensively on dual class ownership of shares. ‘This raises the possibility that a minority of the family could block the sale.’
“Under Dow Jones rules, Class B shares have 10 votes per share, while Class A shares, the ones traded on the New York Stock Exchange, have but one vote. But when Class B shares are sold, they become Class A shares, and lose their special voting rights.”
Read more here.
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