News Corp. closes deal on sale
Dow Jones and News Corp. on Wednesday announced the consummation of their four-month courtship.
News Corp. will pay $5.6 billion for the financial-news company, which is roughly the amount the $60-per-share offer comes to when all the outstanding shares are taken into account.
Deal still needs to be approved by shareholders, but that move is expected to be a formality.
About 37% of the Bancroft’s 64% of voting stock approved the merger. While about 7% of the remaining stock, held by the Ottaway newspaper family, is expected to vote against the merger, most of the remaining shares are expected to approve it.
That would easily give News Corp. the majority that it needs.
That vote — and the deal’s closure — is expected to happen within the next three months.
Also on Wednesday, the companies announced the makeup of the five-member board that will be put in place to ensure the Wall Street Journal’s editorial independence.
They include AP honcho Louis Boccardi, longtime editorialist Thomas Bray, former Congresswoman Jennifer Dunn, ex-Tribune exec Jack Fuller and new media guru Nicholas Negroponte. Bray, who once served as the editorial page editor at the Detroit News and also contributes to OpinionJournal.com, will be the group’s chairman.
But what kind of power they will have and how they will enforce that power remained open questions as the merger moves forward. Observers in particular have worried about changes to the editorial mission and newsroom cuts.
In a memo to employees Wednesday, Dow Jones CEO Richard Zannino reassured newsroom employees, many of whom had protested the sale, about the changes.
“News Corp., through vehicles such as the Fox (network), its cable channels and interactive properties such as MySpace, has broad marketing platforms and channels of distribution to take our indispensable and differentiated content to new and bigger audiences,” he wrote.
“With nearly $30 billion in annual revenue, News Corp. has the money–and the intention–to invest in our businesses on a scale we can’t.
But he also acknowledged that “We can’t begin to predict the details of the integration to follow. In this interim, we’ll do our best to keep you informed. We’ll try in particular to advise as soon as possible of any developments that might affect you directly.”