News Corp. Chairman Rupert Murdoch appeared frustrated Wednesday with the state of talks with Dow Jones & Co., publisher of The Wall Street Journal, saying it was unclear where the company’s controlling shareholders stood.
Murdoch has offered $5 billion for the company but has been entangled for several weeks in negotiations with the Bancroft family, which controls Dow Jones, largely over their concerns about safeguards for the Journal’s editorial independence and integrity.
“They keep changing their minds,” Murdoch told The Associated Press in Sun Valley, Idaho, during a conference of top media executives hosted by investment banker Herbert Allen. Murdoch is a regular guest at the conference, which has become a landmark event for media power players since the early 1980s.
Murdoch didn’t elaborate on the state of play with Dow Jones, and declined to comment on a recent approach made to Dow Jones by Brad Greenspan, an Internet entrepreneur who was an early investor in MySpace, a social networking site now owned by Murdoch’s company, News Corp.
Greenspan and Ron Burkle, who made a fortune investing in supermarket chains, met with representatives of Dow Jones’ board Tuesday, but the talks were exploratory in nature and it wasn’t clear whether a viable alternative to Murdoch’s rich offer of $60 a share would emerge. Greenspan and a spokesman for Burkle did not return messages seeking comment.
The Bancrofts originally rebuffed Murdoch’s approach in early May but then reversed themselves and agreed to meet with him in early June to discuss their concerns about keeping the Journal’s coverage free from corporate interference.
An agreement is now in place that would create a committee that would have to approve the hiring or firing of top editors at the Journal, but a complete proposal for News Corp. to buy Dow Jones has yet to take shape. Assuming it does, the plan would still have to be approved by the Bancroft family, who have been divided over whether to sell to Murdoch.
Burkle has tried before to buy other newspapers, without success. Last year he teamed up with a union representing newspaper employees in an attempt to buy nine papers owned by the former Knight Ridder Inc., and he also tried to buy Tribune Co., publisher of the Los Angeles Times, together with fellow Los Angeles-based billionaire Eli Broad.
In this case, Burkle responded to an approach by a union representing Wall Street Journal reporters to help find alternatives to ownership by Murdoch. That union says it’s concerned that the Journal’s quality and independence would suffer under Murdoch, but Murdoch says those concerns aren’t justified.
Despite the late approach by Greenspan and Burkle, many on Wall Street and the newspaper industry believe Murdoch’s offer is too high to beat. The $60 per share price represents a massive premium of about 65 percent over the mid-$30s level that Dow Jones stock was trading at before the proposal became public.
John Morton, an independent newspaper industry analyst based in Silver Spring, Md., said it was a “long shot” that Burkle and Greenspan would be able to put together a bid that would have a chance against Murdoch’s.
And if there were other deep-pocketed potential bidders for Dow Jones, Morton said, they would have surfaced by now. “Anybody who would have had an interest in this would know they can’t sit around.”