Posted by: Jon Fine on November 28, 2008
My column in the new issue of BusinessWeek is about Michael Wolff’s new book, “The Man Who Owns The News,” which is a sort of biography of Rupert Murdoch and an unusually detailed account of his pursuit and capture of Wall Street Journal parent company Dow Jones.
(Obligatory disclosure: Michael is a friend, and we sometimes spar with on-air CNBC, a channel for which we’re both on-air contributors.)
If you are as into this stuff as I am, there’s a ton of tasty bits within—-like the following crucial scene in which Murdoch delivers his knockout bid to then-Dow Jones CEO Rich Zannino. Said scene occurs during a breakfast at News Corp headquarters on March 29, when Dow Jones stock was trading in the mid-thirties.
(I particularly love the way in which Murdoch and Zannino dance around the semantics of whether or not Murdoch is actually making an offer or is just, you know, kinda thinking out loud, or something.)
The following exchanges occur, Wolff writes, after something like forty five minutes of beating around the bush, talking about American Idol, Murdoch’s plans for the Fox Business Network, and how advertising revenue is dropping for newspapers.
Murdoch: "Well, I’m thinking about making an offer to buy Dow Jones."
Zannino: "You know, Rupert, you know as well as anybody, this isn’t my call. It’s the [Bancroft] family’s call. And the family has consistently—and Rupert, even as recently as our last board meeting—said that they’re committed to the independence of Dow Jones and they have no interest in selling the company.”
Murdoch: "I know that. I was thinking I’d take the offer directly to the board. I know the family feels that way. I’ve called [Hemenway and Barnes attorney and Bancroft family trustee Michael] Elefante in the past. He won’t even take a number.
The number I’m thinking of is. . . sixty."
Zannino: [Internally] "Holy [expletive]!" (Externally) Silence.
Zannino: (Internally) "I’ve got to get the hell out of here."
Murdoch: "So that’s what I’m going to do—I’m going to make an offer to the board. Did I just make an offer to you?"
Zannino: "No, you didn’t. You mused about wanting to buy Dow Jones. I told you the family has the call and it’s not for sale, and you told me you were going to contact the board." (He goes on, Wolff writes, to tell Murdoch “he isn’t going to tell his board about the offer, because it’s not really an official offer, suggesting to Murdoch that if anyone asks him about it, he should say he was just joking about $60.”)
In his car after the breakfast, Zannino calls Dow Jones general counsel Joe Stern:
“He gave me a number.”
“I’ll tell you what it is when I get to the office. It’s nuclear.”