Ex-Dow Jones CEO Would Get Fat on a Sale

The news that the Bancroft family is considering selling Dow Jones (DJ) to Rupert Murdoch came as a surprise last Friday ... to anyone unfamiliar with the laws of money.

Or who hadn't read the company's public filings.

Almost exactly a month ago, just after Rupert Murdoch had made his $5 billion offer for Dow Jones and been rebuffed, I revealed here that the bid would be worth an extra $500 million to the Bancrofts.

"There will continue to be protestations about the sanctity of the Journal's independence," I predicted, "but $500 million can soothe some ruffled principles."

The reality? Dow Jones shares were just $36 and change before Murdoch. The value of the Bancrofts' stake was then just over $740 million. It had been sliding grimly, along with the rest of the newspaper world, for years.

Murdoch is prepared to pay them $1.24 billion for the same shares. Not bad.

No wonder they changed their minds. And no wonder attempts to dismiss the offer sparked threats of shareholder lawsuits.

Five hundred million bucks has a wonderful way of concentrating the mind.

But why can't they just admit they want the money? Instead, the Bancrofts sent out representative Michael Elefante to explain they had conducted a "detailed review of the business" and "the evolving competitive environment." Such contemplation, he said, had led the family to a "consensus that the mission of Dow Jones may be better accomplished in combination or collaboration with another organization, which may include News Corp. ."