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Bancrofts Say No To News Corp

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Shortly before 4 PM today Dow Jones & Co. released a statement saying that shares representing “slightly more than 50%” of the voting power of the company would vote against the unsolicited proposal from News Corp to buy the company for $60 a share. The Bancroft family—which owns 65% of the voting power of the company through its Class B shares—has been considering the bid today, as DealBreaker reported earlier.
It isn’t clear how much of the Bancroft family has agreed to reject the bid from News Corp. The statement says that shares representing a slight majority would vote against the deal—which may imply that there is less than unanimity among the shareholding Bancroft family members. If the opposition to the deal is only slightly in the majority, it might not take too much more to swing a few more shares in favor a proposal.
There’s raises the possibility that the Bancroft’s are simply playing hard to get. In the past, the family has reacted swiftly to reject buyout proposals, sometimes extinguishing them before they reached the stage of a public offer to purchase the shares. Here the family let the deal linger until just before the markets closed. This might signal that they are open to a sale of the company—and are perhaps looking for a higher bid from Murdoch or other suitors. Within the company there has definitely been a lot of discussion that the family is treating this deal differently than earlier deal, a source DealBreaker spoke to earlier today said.
Today Wall Street Journal reporter Martin Peers reported that the family has known about the deal for weeks. "The offer was made in a letter sent prior to the annual meeting April 18. But whereas the company has quickly dismissed approaches to sell in the past, the family has spent the past couple of weeks contemplating the offer," Peers wrote.
News Corp would not have made an offer for Dow Jones in such a public way without some confidence that it could buy the company, DealBreaker was told by a person familiar with the dealmakers inside of Murdoch camp. A couple of hours before the statement from the company was released, CNBC’s Charlie Gasparino reported that Murdoch was given a greenlight to announce the proposal from within.
“Murdoch had recently put out feelers to the powers that be at Dow Jones and her received, essentially, a positive response to put the ‘unsolicited’ bid out there,” Gasparino said.
The statement from the company came as News Corp. chief executive Rupert Murdoch discussed his proposal on Fox News Channel, which is owned by News Corp. “Mr. Murdoch said his offer is ‘a big, generous offer’ and that he expects to meet with the Bancrofts in the next two to three weeks. Mr. Murdoch said he has heard ‘nothing directly’ yet from the family,” Peers said describing the interview.
[John Carney contributed to this item. It has been updated with additional reporting and links since it was originally published.]
Dow Jones Discloses Information Received From Bancroft Family Representative [Press Release]
Murdoch's News Corp. Makes $5 Billion Bid for Dow Jones [Wall Street Journal]