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Murdoch Buys WSJ, Journalism Weeps

PhotoJones

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What a sad day for objective news reporting:

Rupert Murdoch got his trophy.
After weeks of back and forth, it looks like Murdoch's News Corp. (NWS, news, msgs) has succeeded in a years-long quest to buy the parent of The Wall Street Journal.
"The Bancroft family has accepted," John Prestbo, editor and executive director of Dow Jones Indexes, told reporters earlier today in Chicago. Dow Jones (DJ, news, msgs) "will be part of News Corp.," Prestbo said.
Murdoch now has enough support from reluctant Bancroft family members to make the deal happen, The Journal reported today.
For News Corp. shareholders, Murdoch's victory raises questions about whether he can make the $5 billion investment pay. For the rest of the media industry, it creates a monster competitor, one that still has the financial wherewithal to make more acquisitions.

"I thought that the proposal made sense economically on both sides," UBS Investment Bank analyst Mike Morris said today. "Both that the Dow Jones shareholders were receiving very good value for what they held and News Corp. had the potential to maximize the value of its broad platform."

The 11th-hour deal

Earlier this morning, the future of the deal was still up in the air: A report published in The Journal said Murdoch had more than 30% of Dow Jones voting power lined up in support of his offer, but there was resistance among the Bancrofts, who control 64% of the votes that will make the decision on any sale.

Last night, one issue still under discussion was the creation of a fund to cover $30 million in fees for financial and legal advisers to the family, The Journal reported.
At one point late yesterday, News Corp. said it was "highly unlikely" to proceed with the bid for Dow Jones without solid support from the Bancrofts.
It took Murdoch 11 weeks to get approval for his proposal from the Dow Jones board, a win he nailed down earlier this month. To succeed with the deal, Murdoch needed about half of the Bancroft family's votes.
About 29% of the voting power that matters is associated with Dow Jones shares that are publicly held, and most Wall Street observers believe that nearly all of those votes will be cast in support of Murdoch. The last 7% the voting power is held by the Ottaway family, which opposes the deal. Jim Ottaway Jr. is a former member of the Dow Jones board. The Bancrofts own just 25% of the company but control 64% of the voting power through ownership of special Class B shares.

Shares of Dow Jones closed up $5.81, or 11.3%, to $57.37 today; shares had fallen $2.89, or 5.3%, to $51.56 in trading yesterday amid doubts that the deal would be approved. News Corp. shares fell 10 cents to $22.74 today.

Resistance from the Bancrofts

News that the deal will go through ends weeks of public hand-wringing by the Bancrofts. Leslie Hill and Dieter von Holtzbrinck, two Bancroft board members, abstained from a July 17 vote in which the Dow Jones board approved the sale, according to The Wall Street Journal. And Christopher Bancroft, who had recently been trying to accumulate voting shares to fend off Murdoch, reportedly left the meeting early.

http://articles.moneycentral.msn.com/Investing/Dispatch/RupertMurdochsBigBet.aspx
 
*bangs head on desk* Dammit, the guy's greed really knows no bounds, does it?
 
It's not like the Wall Street Journal can get too much more Conservative, but I still have a problem with one man owning so many news outlets.
 

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