Rupert Murdoch's latest facts-and-oration session notwithstanding, the current conventional wisdom in the Concrete Canyon of Wall Street is that the Bancroft family that controls Dow Jones (NYSE: DJ) will reject any offer forwarded by the News Corp (NYSE: NWS). It's been said that everyone has his or her price, but Wall Street does not see Murdoch forwarding a "beyond-generous" offer. Indeed, there is a growing sense on the Street that a News Corp. takeover of Dow Jones simply represents a bad fit. In Thursday afternoon trading, Dow Jones was down 61cents to $51.59 while News Corp was down 19 cents to $23.07.
News Corp., which has forwarded a $60 per share offer for Dow Jones, is eying DJ as part of a plan to substantially increase business news content ahead of a much-bantered launch of a business news channel to compete with CNBC, owned by General Electric (NYSE: GE).
However, Murdoch's operations and news/publishing decisions display little evidence that the multi-platform media conglomerate will adeptly deploy any Dow Jones assets acquired. Murdoch's operation has emphasized the brief and the glib, and in some cases superficial and sensational coverage of news events, and has kept earnings at the forefront. Meanwhile, The Wall Street Journal, owned by Dow Jones, has served as the industry standard for incisive and sophisticated business news coverage for more than 30 years. Further, as the Bancrofts could probably attest, the Dow Jones organization has routinely sacrificed the bottom line if news coverage required it to do so. Given the canyon-sized gap in content and operationally philosophy between the two organizations, a News Corp / Dow Jones combination is hard to reconcile.
Further, there is the public trust dimension -- i.e. whether the Bancrofts would sell to anyone, period. Despite the very real financial pressures, newspapers, particularly the major dailies -- The New York Times, The Washington Post, The Los Angeles Times, and The Wall Street Journal -- retain, at least in the view of some, a public trust dimension. They're not like "any other business." They play a unique role -- codified by the Framers of the U.S. Constitution via the First Amendment -- to inform citizens to help them make more prudent decisions in the American democracy.
It's hard to place a dollar figure on the latter, and there is a sense on Wall Street that the Bancrofts are not likely to try.
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