News Corp makes bid for Dow Jones/Murdoch move for Dow Jones rejected/Thomson in ‘friendly’ move for Reuters
Thomson in ‘friendly’ move for Reuters
By Andrew Edgecliffe-Johnson and Gordon Smith in London and Aline van Duyn in New York
Copyright The Financial Times Limited 2007
Published: May 4 2007 11:47 | Last updated: May 4 2007 22:22
Executives at Reuters met their counterparts at Canada’s Thomson Corporation this week to discuss a takeover of the 156-year-old UK-listed news and data provider in the latest move in the battle for control of the lucrative financial news market.
The approach was described on Friday as “friendly” by people familiar with Reuters’ thinking, but success will hinge on whether the two sides can convince directors of the Founders Share Company, a body set up to safeguard Reuters’ independence, that its editorial integrity would not be compromised.
Reuters confirmed on Friday that it had received a preliminary approach from an unnamed bidder – known to be Thomson, the family-controlled Canadian owner of Thomson Financial, a smaller rival to Reuters and Bloomberg.
News of the approach follows an unsolicited $60-a-share offer this week for Dow Jones from Rupert Murdoch, chairman of News Corporation, which valued the owner of the Wall Street Journal, the largest US business newspaper, at $5bn.
Aline van Duyn discusses this week’s potential blockbuster mergers in the media and internet sectors
ValueAct, Reuters’ second biggest shareholder, said it would be “supportive” of a bid from Thomson. Jeffrey Ubben, managing partner, said: “Thomson has good management, there would be room for a tremendous amount of synergy, and we would be interested in taking stock.”
Reuters shares closed up 123½p, or 25 per cent, at 615¾p in spite of its warning the bid was at a preliminary stage, giving the company a market capitalisation of £7.75bn ($15.4bn).
Neither side would confirm market rumours that the initial approach had been pitched at about 600p but it is understood that Reuters is planning to hold out for about 750p.
Thomson shares were down 1 per cent at $47.93, valuing the group at $28bn.
Combining Reuters and Thomson Financial would create a group with a larger share of the market data industry than Bloomberg, the market leader.
Thomson’s approach would be funded in part by the sale of Thomson Learning, its educational publishing unit – expected to fetch up to $6bn, 20 per cent higher than original estimates.
The sale of the unit, which sells textbooks and educational software, is expected to be completed by the end of June. It will focus Thomson more closely on its financial data division.
The approach comes at a time when Reuters is undergoing a recovery engineered by Tom Glocer, the first chief executive of the group to have no reporting experience.
Mr Glocer has overseen cultural change and diversification at the news organisation.
News Corp makes bid for Dow Jones
By Joshua Chaffin and Paul Taylor in New York
Copyright The Financial Times Limited 2007
Published: May 1 2007 16:31 | Last updated: May 1 2007 16:46
Rupert Murdoch’s News Corp launched a take-over bid for Dow Jones on Tuesday, offering $60 a share, or more than $5bn, for the company that owns the Wall Street Journal newspaper.
Mr Murdoch, who has long coveted the Journal, the world’s largest business paper, made the unsolicited, all-cash offer in a letter sent to the Dow Jones board two weeks ago. The report of the offer by CNBC spurred a 57 per cent jump in Dow Jones shares to $57.28, before authorities halted trading.
The company then released a statement confirming that it had received the News Corp offer, and that the Bancroft family, which controls its voting shares, were “evaluating the proposal.”
If it were consummated, a deal would bring one of the world’s most influential newspapers under Mr Murdoch’s media empire. It would also instantly bolster a new cable business channel that News Corp’s Fox division is planning to launch later this year to compete with CNBC.
Murdoch move for Dow Jones rejected
By Joshua Chaffin, Aline van Duyn and James Politi in New York
Copyright The Financial Times Limited 2007
Published: May 1 2007 16:31 | Last updated: May 2 2007 14:13
The fate of Dow Jones and its flagship Wall Street Journal newspaper were thrown into question on Tuesday after the Bancroft family, the company’s controlling shareholder, rebuffed an unsolicited $5bn bid from Rupert Murdoch’s News Corp.
In spite of the rejection, Mr Murdoch’s first pass revealed a split among the Bancrofts, and spurred speculation that News Corp would increase its offer, or that other media groups or private equity firms would join the fray for one of the world’s most influential newspapers.
The $60-a-share, all-cash offer was sent to the Dow Jones board two weeks ago, according to people familiar with the matter. News of the offer on Tuesday triggered a 57 per cent jump in Dow Jones shares to $57.28 before authorities halted trading. Shares eventually closed at $56.20 and were up another 1.8 per cent at $57.23 in pre-market activity on Wednesday.
Shares of other newspaper and financial information companies, including The New York Times Company, Reuters and Pearson, owner of the Financial Times, also rallied.
News Corp shares, however, dipped as much as 3.9 per cent in trading in Australia early Wednesday.
John Gapper explains why Rupert Murdoch’s News Corp hopes to buy Dow Jones - and why now
Mr Murdoch has long coveted the Journal for its editorial clout. More recently, he has come to view the paper as a means to bolster a US cable business channel he is planning to launch later this year and extend News Corp’s online reach. “This is the greatest newspaper in America – one of the greatest in the world,” he said in an interview with News Corp’s Fox News Channel. “But...it needs to be part of a bigger organisation to be taken further.”
The bid has forced members of the Bancroft family, which has controlled Dow Jones for nearly 80 years, to weigh their allegiance to the company against a 65 per cent premium offered by Mr Murdoch. The Bancrofts have reduced their holdings of Dow Jones non-voting common stock from 35 per cent in 1997 to just over 6 per cent at the start of this year, though they control 64.2 per cent of its class B voting shares.
In a statement on Tuesday, Michael Elefante, a Dow Jones director and lawyer representing the Bancroft family, said: “Members of the family and the trustees of trust for their benefit have advised him that they will vote shares constituting slightly more than 50 per cent of the outstanding voting power of Dow Jones against the proposal.”
News Corp shares fell 4.2 per cent as investors questioned Mr Murdoch’s decision to bet on the industry at a time when readers and advertisers are migrating to the internet. Like other business publishers, Dow Jones has also struggled since the ending of the 1990s stock market boom.
But the company has performed better than other newspaper groups by acquiring internet properties such as the MarketWatch and Factiva websites, and charging for online content.
The news of the offer was preceded on Monday by a surge in trading of Dow Jones options, with volume rising by seven-times the daily average for April.
By Andrew Edgecliffe-Johnson and Gordon Smith in London and Aline van Duyn in New York
Copyright The Financial Times Limited 2007
Published: May 4 2007 11:47 | Last updated: May 4 2007 22:22
Executives at Reuters met their counterparts at Canada’s Thomson Corporation this week to discuss a takeover of the 156-year-old UK-listed news and data provider in the latest move in the battle for control of the lucrative financial news market.
The approach was described on Friday as “friendly” by people familiar with Reuters’ thinking, but success will hinge on whether the two sides can convince directors of the Founders Share Company, a body set up to safeguard Reuters’ independence, that its editorial integrity would not be compromised.
Reuters confirmed on Friday that it had received a preliminary approach from an unnamed bidder – known to be Thomson, the family-controlled Canadian owner of Thomson Financial, a smaller rival to Reuters and Bloomberg.
News of the approach follows an unsolicited $60-a-share offer this week for Dow Jones from Rupert Murdoch, chairman of News Corporation, which valued the owner of the Wall Street Journal, the largest US business newspaper, at $5bn.
Aline van Duyn discusses this week’s potential blockbuster mergers in the media and internet sectors
ValueAct, Reuters’ second biggest shareholder, said it would be “supportive” of a bid from Thomson. Jeffrey Ubben, managing partner, said: “Thomson has good management, there would be room for a tremendous amount of synergy, and we would be interested in taking stock.”
Reuters shares closed up 123½p, or 25 per cent, at 615¾p in spite of its warning the bid was at a preliminary stage, giving the company a market capitalisation of £7.75bn ($15.4bn).
Neither side would confirm market rumours that the initial approach had been pitched at about 600p but it is understood that Reuters is planning to hold out for about 750p.
Thomson shares were down 1 per cent at $47.93, valuing the group at $28bn.
Combining Reuters and Thomson Financial would create a group with a larger share of the market data industry than Bloomberg, the market leader.
Thomson’s approach would be funded in part by the sale of Thomson Learning, its educational publishing unit – expected to fetch up to $6bn, 20 per cent higher than original estimates.
The sale of the unit, which sells textbooks and educational software, is expected to be completed by the end of June. It will focus Thomson more closely on its financial data division.
The approach comes at a time when Reuters is undergoing a recovery engineered by Tom Glocer, the first chief executive of the group to have no reporting experience.
Mr Glocer has overseen cultural change and diversification at the news organisation.
News Corp makes bid for Dow Jones
By Joshua Chaffin and Paul Taylor in New York
Copyright The Financial Times Limited 2007
Published: May 1 2007 16:31 | Last updated: May 1 2007 16:46
Rupert Murdoch’s News Corp launched a take-over bid for Dow Jones on Tuesday, offering $60 a share, or more than $5bn, for the company that owns the Wall Street Journal newspaper.
Mr Murdoch, who has long coveted the Journal, the world’s largest business paper, made the unsolicited, all-cash offer in a letter sent to the Dow Jones board two weeks ago. The report of the offer by CNBC spurred a 57 per cent jump in Dow Jones shares to $57.28, before authorities halted trading.
The company then released a statement confirming that it had received the News Corp offer, and that the Bancroft family, which controls its voting shares, were “evaluating the proposal.”
If it were consummated, a deal would bring one of the world’s most influential newspapers under Mr Murdoch’s media empire. It would also instantly bolster a new cable business channel that News Corp’s Fox division is planning to launch later this year to compete with CNBC.
Murdoch move for Dow Jones rejected
By Joshua Chaffin, Aline van Duyn and James Politi in New York
Copyright The Financial Times Limited 2007
Published: May 1 2007 16:31 | Last updated: May 2 2007 14:13
The fate of Dow Jones and its flagship Wall Street Journal newspaper were thrown into question on Tuesday after the Bancroft family, the company’s controlling shareholder, rebuffed an unsolicited $5bn bid from Rupert Murdoch’s News Corp.
In spite of the rejection, Mr Murdoch’s first pass revealed a split among the Bancrofts, and spurred speculation that News Corp would increase its offer, or that other media groups or private equity firms would join the fray for one of the world’s most influential newspapers.
The $60-a-share, all-cash offer was sent to the Dow Jones board two weeks ago, according to people familiar with the matter. News of the offer on Tuesday triggered a 57 per cent jump in Dow Jones shares to $57.28 before authorities halted trading. Shares eventually closed at $56.20 and were up another 1.8 per cent at $57.23 in pre-market activity on Wednesday.
Shares of other newspaper and financial information companies, including The New York Times Company, Reuters and Pearson, owner of the Financial Times, also rallied.
News Corp shares, however, dipped as much as 3.9 per cent in trading in Australia early Wednesday.
John Gapper explains why Rupert Murdoch’s News Corp hopes to buy Dow Jones - and why now
Mr Murdoch has long coveted the Journal for its editorial clout. More recently, he has come to view the paper as a means to bolster a US cable business channel he is planning to launch later this year and extend News Corp’s online reach. “This is the greatest newspaper in America – one of the greatest in the world,” he said in an interview with News Corp’s Fox News Channel. “But...it needs to be part of a bigger organisation to be taken further.”
The bid has forced members of the Bancroft family, which has controlled Dow Jones for nearly 80 years, to weigh their allegiance to the company against a 65 per cent premium offered by Mr Murdoch. The Bancrofts have reduced their holdings of Dow Jones non-voting common stock from 35 per cent in 1997 to just over 6 per cent at the start of this year, though they control 64.2 per cent of its class B voting shares.
In a statement on Tuesday, Michael Elefante, a Dow Jones director and lawyer representing the Bancroft family, said: “Members of the family and the trustees of trust for their benefit have advised him that they will vote shares constituting slightly more than 50 per cent of the outstanding voting power of Dow Jones against the proposal.”
News Corp shares fell 4.2 per cent as investors questioned Mr Murdoch’s decision to bet on the industry at a time when readers and advertisers are migrating to the internet. Like other business publishers, Dow Jones has also struggled since the ending of the 1990s stock market boom.
But the company has performed better than other newspaper groups by acquiring internet properties such as the MarketWatch and Factiva websites, and charging for online content.
The news of the offer was preceded on Monday by a surge in trading of Dow Jones options, with volume rising by seven-times the daily average for April.
posted by Carlos T Mock at 7:18 AM
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