Buyout Targets: Update on Dow Jones
By Ann Sosnowski
In this article
GE, a week after previous news circulation, is rumored again to be trying to bid for Dow Jones Company.
GE this time is going into the deal with The Financial Times' Pearson PLC as its partner.
While the Bancroft family is demanding editorial independence from Murdoch in his proposed deal, GE is willing to give it to them from the get-go.
Buyout Targets: Update on Dow Jones
A new bidder for Dow Jones Company (DJ:NYSE) has arrived in town…
General Electric Company (GE:NYSE) and Pearson PLC (PSO:NYSE) are in talks to enter a joint bid for the newspaper company whose major asset is The Wall Street Journal.
One specific component of the proposed buyout plan from GE and Pearson (which owns The Financial Times) is a minority stake in the company for the Bancroft family, who has ruled the newspaper company in a dual-share class structure, one of many which have been heavily scrutinized by newspaper company shareholders recently.
Additionally, GE owns CNBC, so adding DJ to its and Pearson's coffers will make it that much more of a strong financial news power.
These talks are being labeled “private and preliminary” but would probably make a better offer than Rupert Murdoch's $60 per-share offer. Murdoch's acquisition of DJ would help his plans to launch a financial television channel from News Corp. (NWS:NYSE), his company that also runs countless newspapers and magazines.
The Bancroft family has also mentioned that it's still working on a proposal to send back to Murdoch concerning his offer, which deals with “protecting the newspaper's editorial independence.”
Dow Jones is saying that it “can't comment on rumors” which in this business usually means something's brewing, and we won't really know until the kinks in the plan are worked out.
What's most interesting about this “rumor” development is the information I provided to you exactly a week ago here in Market Report:
“NBC Universal [part of General Electric (GE:NYSE) and Microsoft Corp. (MSFT:NASDAQ)] entertained the idea to counter-bid against Murdoch for DJ, but pulled out of the deal a week ago.
“The deal with the possible bid by NBC was that the company had approached Microsoft due to both companies' joint msnbc.com venture. Even though MSNBC is a huge portal for news and entertainment, they decided that the financial newspaper company would not fit into the picture.”
General Electric is obviously set on owning Dow Jones, whichever way they can get it, and with whatever partner will allow it.
Perhaps the world-renowned company that runs such businesses across the board as health care, media and industrial is hedging its new alternative energy businesses with more of a “safe bet?”
***
Ann Sosnowski is a small and mid-cap stock analyst for Taipan Financial News. She is the editor of Diligent Investor, a monthly newsletter that balances conservative and moderately risky investments that pertain to current market trends. She is also the editor of Diligent Investor Micro-Cap Hot Sheet, a monthly newsletter that finds the hottest penny and micro-cap stocks on the market.
Did you like this article? Get Market Report everyday! Sign up Free!
Related Articles
Buyout Targets: Private Equity
Buyout Targets: Merger Mania Monday
Buyout Targets: Bull Market Investing (TFN's Market Insights)
Related Resources
Buyout Targets: GE Bids for Dow Jones, Supposedly (via Bloomberg)
Buyout Targets: Wendy's Puts Itself Up for Sale (via CNN)
Buyout Targets: BHP Billiton May Buy Alcoa