Updated from 5:05 p.m. EDT
( DJ) said Wednesday that its board is taking control of negotiations over the sale of the company away from its controlling shareholders, the Bancrofts, in a move that could grease the tracks for a deal with
The Wall Street Journal
, Dow Jones' flagship newspaper, reported that the step was taken out of concerns that the ongoing family squabbles over editorial integrity could scare away News Corp. CEO Rupert Murdoch and his $5 billion buyout offer.
In a statement, Dow Jones said that its board and representatives of the Bancroft family agreed that the directors should take the lead in the negotiations, as well as all other proposals. The company emphasized that "any transaction must include appropriate provisions with respect to journalistic and editorial independence and integrity."
Previously, News Corp. was negotiating directly with Bancroft family members over safeguards designed to preserve the editorial standards of its media properties. Murdoch has a history flouting the editorial practices that have long been a cornerstone of publishing traditions at Dow Jones and other U.S. newspaper publishers.
The Bancroft family, which controls the publisher through a dual-class share structure, wouldn't be completely shut out of the talks. There are three family members on Dow Jones' board -- Christopher Bancroft, Elizabeth Steele and Leslie Hill -- plus an attorney, Michael Elefante with Hemenway & Barnes, who represents the family trusts.
And any deal that is made will still require approval from shareholders. That could give members of the Bancroft family that are opposed to the deal one last chance to head off a sale.
"There can be no assurance that any transaction or other corporate action will result from the foregoing or that the board of directors or the members of the Bancroft family will support any specific proposal," said Dow Jones.
Meanwhile, another potential alternative to News Corp.'s $60-a-share offer has emerged. Brad Greenspan, the former head of social-networking site MySpace, announced Wednesday that he will seek a non-controlling stake in Dow Jones through a $60-a-share "Dutch auction."
Greenspan is the former chairman and chief executive of Intermix Media, which sold MySpace to News Corp. in 2005 for $580 million. He left Intermix in 2003 amid accounting restatements and an informal investigation by the Securities & Exchange Commission, but he retained a roughly 11% stake in the company.
After News Corp. struck a deal to buy MySpace, Greenspan made an unsuccessful effort to block the acquisition through a legal challenge, alleging that the deal defrauded shareholders by undervaluing the Internet's most popular social-networking site.
In a release, Greenspan's investment group proposed to buy $250 million worth of Dow Jones' common stock at $60 a share. It said it would then provide the company with capital to boost its Internet, digital and broadcast presence, and it would take two seats on the company's board of directors.
is in talks with
, publisher of the
, about making a run at Dow Jones.
Supermarket magnate Ron Burkle has agreed to explore a bid with the Independent Association of Publishers' Employees, a Dow Jones employee union that has been staunchly opposed to a deal with News Corp. Also, public relations honcho Brian Tierney, owner of the
, said recently that he wanted to join the fray.