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.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV