News Corp., Dow Jones deal expected Tuesday: source
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By Robert MacMillan and Kenneth LiNEW YORK (Reuters) - Rupert Murdoch's News Corp. is expected to reach a definitive agreement to buy Dow Jones &Co. Inc. on Tuesday evening, capping his three-month pursuit of the publisher of the Wall Street Journal, a source familiar with the matter said.Dow Jones shares rose nearly 12 percent in anticipation of the deal."The Bancroft family has accepted," John Prestbo, editor and executive director of Dow Jones Indexes, told reporters in Chicago. He said Dow Jones "will be part of News Corp." Prestbo said the information came from an internal company memo.The Bancrofts own 64 percent of Dow Jones voting stock and have been deliberating over whether to accept Murdoch's $60-per-share bid, first announced in early May.As of late Monday, Bancrofts holding about 29 percent of Dow Jones voting stock had voted in favor of the deal, according to The Wall Street Journal.News Corp.'s board of directors is expected to discuss the deal at 4 p.m. EDT (2000 GMT) Tuesday, one source said. The Dow Jones board is expected to meet at 7 p.m., another source familiar with the discussions said.Dow Jones is discussing a plan to have News Corp. cover the legal fees incurred by the Bancroft family, amounting to at least $30 million, the Journal reported on Monday."After all the high-minded concerns about editorial interest and journalistic excellence, it gets down to who pays the legal fees for the Bancrofts," Benchmark & Co. analyst Ed Atorino said. "And some of the trustees bailed, fearing they'd get sued by some of the younger trust beneficiaries if they voted against the deal -- so much for principles."Some members of the Bancroft family had said they opposed Murdoch's bid because they believed he would interfere with Dow Jones' news operations, while others were seeking an even richer premium than the 65 percent premium News Corp. offered.On Monday, a News Corp. spokesman said it was "highly unlikely" to proceed with the offer unless more than a reported 28 percent of the voting shares owned by the Bancroft family supported the deal.News Corp. and a representative for the Bancroft family declined comment. Dow Jones was not immediately reachable.Dow Jones shares were up $5.90 at $57.46 in late morning trading on the New York Stock Exchange. They reached as high as $57.50 earlier."The definitive agreement has not been signed, but people familiar with the situation tell me it will be this evening," a CNBC newscaster reported on Tuesday.(Additional reporting by Sam Nelson in Chicago and Megan Davies in New York)(Editing by Dave Zimmerman and Gerald E. McCormick; Reuters Messaging: kenneth.li.reuters.com@reuters.net; +646-223-6224; e-mail: kenneth.li@reuters.com))
(c) Reuters 2007. All rights reserved. Republication or redistribution of Reuters content, including by caching, framing or similar means, is expressly prohibited without the prior written consent of Reuters. Reuters and the Reuters sphere logo are registered trademarks and trademarks of the Reuters group of companies around the world.
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