Bancroft speaks out
Obstacles are beginning to mount against News Corp.’s bid to buy Dow Jones.
One member of the intensely private Bancroft family, which owns Dow Jones, spoke out for the first time against the bid on Thursday.
“I’m open to any situation that benefits the Wall Street Journal and Dow Jones and its shareholders. At the moment, I don’t see anything that would do that,” Chris Bancroft said in an interview in Dow Jones’ own Wall Street Journal.
Observers cautioned that Bancroft, who represents one of the three branches of the newspaper family, has historically been among those more reluctant to sell.
But the first public comment, no matter the source, was likely to set the tone for the debate in both the media and among the family.
And Chris Bancroft is on the board of directors. Together with his two siblings, he also controls more than 20% of voting stock, though there are signs of fissures even within his branch of the family.
News came the same day that Jim Ottaway, who oversees Dow Jones’ regional-newspaper division of the same name, told Reuters that he was not interested in selling his stake. Ottaway controls about 6% of voting shares.
Despite reports that some members were holding out for an even better price than the $60 per share that Rupert Murdoch’s News Corp. has offered, Ottaway told Reuters, “We don’t want to sell to Murdoch for (even) $75 a share.”
While it’s impossible to tell how much posturing is fueling such comments, the increased willingness of those who hold voting shares to speak out raised speculation in media and investor circles that the News Corp. bid was in danger.
The momentum was strong enough that investors initiated a modest selloff Thursday, with the stock dropping 2%.
The Journal seemed to be rallying against the News Corp. bid in its story Thursday, citing Chris Bancroft as a “potential swing vote who could steer the family in its favor” and noting that Bancroft had received 50 letters from Journal reporters concerned about the sale.
Some members of the family met Wednesday to discuss the sale amid growing signs of division within its ranks. The various family branches collectively control approximately 64% of DJ voting stock.
News also came the same day that analyst Fred Searby of JPMorgan upgraded Dow Jones competitor the New York Times to neutral because of better ad forecasts. The Times has faced scrutiny for its management structure, which critics say puts too much control in the hands of the Sulzbergers.
But investors have been sanguine on the company lately, boosting it nearly 10% in the past month.