Dow Jones Plays Hard to Get

Updated from 4:51 p.m. EDT

Rupert Murdoch sought to make Dow Jones (DJ) a buyout offer it can't refuse, but he has an uphill battle in his bid to become the godfather of the U.S. media industry.

Dow Jones said late Tuesday that the Bancroft family, the controlling shareholders, has told the publisher's board that members of the family will vote shares constituting slightly more than 50% of the company's voting power against the $5 billion acquisition offer from Murdoch's media empire, News Corp.(NWS).

Dow Jones said its board would factor this information into its evaluation of the offer.

Shares of Dow Jones, the publisher of The Wall Street Journal, soared 55% Tuesday to $56.20 after Murdoch's offer was disclosed. The $60-a-share bid amounts to a whopping premium of 65% over Dow Jones' closing price on Monday.

"This offer is so outrageous that it simply can't be dismissed out of hand by Dow Jones' board of directors," says Ed Atorino, analyst with The Benchmark Company. "This lofty premium above current market prices is simply unprecedented."

Like its newspaper counterpart, New York Times (NYT), Dow Jones is controlled by a family trust. The Bancrofts, whose ancestors built the company into a media empire, maintain control over the company's voting rights through a dual-class share structure, which is designed to shield the editorial independence of its news operations from the animal spirits of Wall Street.

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