Murdoch closes in on Wall Street Journal

Published on Wednesday 1 August 2007 00:54

RUPERT Murdoch last night appeared to be on the brink of owning the Wall Street Journal as his £2.6 billion bid for the Dow Jones group headed towards completion.

Victory for the media tycoon in the months-long tussle has revolved around convincing the Bancroft family, which controls Dow Jones through a 64 per cent stake in voting stock.

The Bancrofts are divided on the prospect of Murdoch ownership and Dow Jones was yesterday understood to be urging News Corp to convince waverers in the family by agreeing to their legal fees of over 15 million.

The Journal itself reported the deal would go through if two holdout Dow Jones shareholders agreed. They are board member Christopher Bancroft and trusts managed by a Denver law firm, Hole Roberts & Owen.

If they agree, it would give News Corp enough Bancroft support to buy Dow Jones. Murdoch is said to want a support level of 28 to 30 per cent voting shares from the Bancrofts to be comfortable.

There are other challengers for ownership. Internet entrepreneur Brad Greenspan has urged Dow Jones to meet him as part of his own proposal for the company.

Greenspan said in a letter on Monday evening that he had lined up five investors to contribute around 300 million to fund three Wall Street Journal online video and cable television spin-offs in Asia, Europe and the US. They reportedly include part of computer giant Intel and venture capital firm Apex Partners.

Former Dow Jones board member Dieter von Holtzbrinck, who resigned in protest of Murdoch's bid, is also considered a potential suitor.

However, suggestions that Dow Jones and News Corp were close to a deal sent shares up by 10.7 per cent in early US trading. The boards of both companies were meeting last night to consider their next moves.

One experienced Murdoch watcher said Rupert Murdoch's ownership of Dow Jones was now "a done deal". Broadcaster Andrew Neil, who edited the Murdoch-owned Sunday Times for 13 years and launched Sky television in the UK, said: "Rupert Murdoch has always wanted a global business brand - that is why almost 20 years ago he tried to buy the Financial Times.

"He [Murdoch] thinks the Wall Street Journal is badly run and an under-exploited asset. His aim will be to wipe the floor with the FT and build the Journal into a really global business brand."

News Corp is also planning to launch a business television channel as an offshoot of its Fox network.

Ownership of the Journal would give it access to the newspaper's journalism and potentially its staff for on-screen use.