Posted by: Jon Fine on June 20, 2007
At first blush, the (firewalled) news that Dow Jones’ board will take over negotiations with News Corp. indicates nothing more that the process will quickly move from its current quiescent state.
And also that if the GE/Pearson deal is serious—well, those guys better get very serious about being serious, like, yesterday, because there is a very nice News Corp. offer already on the table and the negotiating-train is leaving the station. (UPDATE 6/21: They have decided to let the train leave without them. So much for the scenario below!)
But today’s development opens up a new, Delicious Dramatic Possibility in the whole Dow Jones sale saga:
Complex GE/Pearson deal comes together post-haste along the lines described in press accounts (Dow Jones becomes an entity in which GE and Pearson each own 40% to 45%, and the Bancrofts own 10% to 20%) but at a valuation slightly below News Corp.’s $60 per share.
This leads the Bancrofts most worried about Murdoch to favor the GE/Pearson bid, the board to favor the News Corp bid, and the rest of us to watch as the two camps go to the mattresses to decide the winner.
(Wild card: Former MySpace-r Brad Greenspan, who in a badly-timed move announced his own intention to purchase around 25% of the company at $60-per-share, just as the Wall Street Journal broke the news about the board taking over negotiations.)