Last updated: February 21, 2008 - 7:58am
DOW JONES BOARD TAKES OVER TALKS ON FIRM'S FUTURE
[SOURCE: Wall Street Journal, AUTHOR: Sarah Ellison at firstname.lastname@example.org, Susan Pulliam & Dennis K. Berman]
Dow Jones & Co.'s board, frustrated with the pace of the Bancroft family's negotiations with News Corp., said it would take over talks on the future of the company. The move, coming after more than two weeks of little progress between the parties, increases the likelihood of a deal to enable Rupert Murdoch's media giant to buy Dow Jones, the owner of The Wall Street Journal. Yesterday, the Bancrofts' four board representatives finished revising a proposal to safeguard the editorial independence of Dow Jones but decided to ask the board to review it before forwarding the document to News Corp. The family had previously insisted that it alone negotiate with Mr. Murdoch about editorial independence. If the sides reached an agreement, the family would have then empowered the board to begin buyout talks. Some independent directors were opposed to this strategy because they felt negotiating editorial independence separately gave the board less leverage on price. Now, both those components have been ceded to the board. Despite backing off of direct talks, however, the Bancrofts still hold enough voting power to veto any deal. The Bancrofts' editorial proposal calls for the establishment of a special committee to enforce a set of editorial principles News Corp. would be expected to adhere to, according to a family spokesman. It also includes protections for top editors and provisions to enforce the agreement. These elements were included in earlier drafts as well, and it wasn't immediately clear how the version submitted to the Dow Jones board had been revised.
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Looking at the potential bidders for Dow Jones & Company — Rupert Murdoch’s News Corporation and a joint effort by General Electric and Pearson — some reporters and editors at The Wall Street Journal are calling the decision a choice between “trash or slash.” And they are wondering which might be worse.
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