Rob Cox and Lauren Silva of Breakingviews.com write about what the going price would be today of Dow Jones & Co., the parent of The Wall Street Journal, which was sold a year ago to News Corp. for $5 billion.
Cox and Silva write, “At the time, there was much teeth-gnashing among members of the Bancroft family, descendants of The Journalâ€™s founder, who controlled Dow Jones. The price Murdoch paid, $5 billion, stifled most of these groans.
“The grumpiest Bancrofts should now be smiling, even as the News Corporation shareholders grimace. Though it may count as a corporate finance achievement, Mr. Murdochâ€™s gambit for Dow Jones has played out poorly for his investors. After all, their interest in News Corporation deals is not derived from the paperâ€™s ability to influence politics, but rather from the financial returns they generate.
“On this score, the deal has so far come up short. The Dow Jones transaction saddled the News Corporation with greater exposure to newspapers and the financial industry, just as both entered their darkest hours. Mr. Murdochâ€™s shareholders â€” among whom he and his family, with a 38 percent stake, are the biggest â€” are paying the price.”
Read more here.