News Corp close to securing votes for Dow Jones

News Corporation was last night thought to be likely to be able to secure sufficient votes from the Bancroft family to proceed with a formal $5bn offer for Dow Jones, according to sources.

It is thought that a significant number of Bancroft family voting shares had still not been accounted for last night, even after their self imposed 5pm deadline yesterday had passed to vote in favour of a takeover.

Some family members were last night still thought to be haggling with their bankers and legal representatives.

While News Corporation managed to secure 28 per cent of the voting shares by Sunday night, News Corporation, parent of The Times, had insisted that it would not pursue a formal offer for Dow Jones unless it secured at least 30 per cent of the votes in favour of a deal from the Bancroft family.

The family, which as a whole control 64 per cent of the voting shares, has been deeply split over the proposal from News Corporation to acquire the media group, which owns The Wall Street Journal newspaper.

In the event that News Corporation manages to secure 30 per cent of the votes from the Bancroft family later today, it is expected that it will proceed with a formal offer for the group.

It is expected that institutional shareholders who control about 29 per cent of Dow Jones shares are broadly in favour of a deal.

There are about 35 adult members of the Bancroft family with the right to vote on a change of ownership of the company. Some have been concerned about the editorial independence of The Wall Street Journal should News Corp take control of its owner. Others had also hoped to be able to extract a higher price.

Last month Rupert Murdoch, chairman and chief executive of News Corporation, offered to create an autonomous editorial board in which the editor of the title "shall not be appointed or dismissed without the approval of the majority of the independent directors".

Christopher Bancroft, who represents about a sixth of Dow Jones voting shares, has sought to stymie the success of a News Corp offer by talking to cash-rich hedge funds and private equity groups to boost his stake in the company and veto any deal.

After News Corp's approach in April, the Bancroft family opposed the offer but later agreed to reconsider. It is thought that the Dow Jones board became frustrated with delays arising from meetings between opposing factions of the Bancroft family. As a result, the family allowed the board to lead bid negotiations with News Corp on their behalf.

The offer from News Corporation values Dow Jones at $60 a share, a 67 per cent premium to its price before the offer became public.

A spokesman for the Bancroft family declined to comment and News Corp last night indicted that there were 'still concerns' about the number of committed votes.

(Published by Times Online, July 31, 2007)

latest top stories

subscribe |  contact us |  sponsors |  migalhas in portuguese |  migalhas latinoamérica