The Wall Street Journal took a look at what its staffers might expect under a Murdoch-controlled Dow Jones & Co. (NYSE: DJ). The lead in the piece sums it up: "Some owners of newspapers seldom, if ever, speak to their editors. Rupert Murdoch is not one of them." Murdoch regularly calls News Corp's (NYSE: NWS) newspapers to dole out tips on stories or complain about the paper's coverage.

While Murdoch downplays his history of meddling, saying that he is impressed with how the Bancroft family has run the paper with a hands-off approach ("we are the sort of people with the same traditions that I think will prove great guardians for this paper."), you have to wonder: What else was he going to say as he tries to get a deal done?

It appears that the Bancroft family may have to choose between its fiduciary duty to shareholders and its moral obligation to journalistic independence. Interesting, both of these are mentioned in the company's Principles of Corporate Governance.

If someone offers you $1 million in cash for your house that's only worth $450,000, would you take the money? Of course you would. That's the same situation that the Bancroft family was in yesterday with Rupert Murdoch's unsolicited $5 billion offer for Dow Jones & Co. (NYSE: DJ).

The Bancrofts, descendants of the founders of the New York-based publisher, turned Murdoch's incredibly generous offer down, proving that just because you're really rich it doesn't make you smart. The Wall Street Journal's Heard on the Street column points out that Murdoch's bid valued Dow Jones at a multiple of 40 times 2007 earnings. Google Inc. (NASDAQ: GOOG) currently trades at a multiple of 31.

That's right, the Australian-born tycoon gave Dow Jones a valuation BETTER than Google. He offered a 65% premium over Monday's closing price, which as the column points out, surpasses what the company could have gotten from private equity players.

An alliance between News Corp. (NYSE: NWS) and Dow Jones makes sense strategically. The Wall Street Journal would be a good fit alongside other Murdoch properties including Fox News Channel, The New York Post and the yet too be launched Fox Business Channel.

Though there's speculation about other potential buyers, I doubt that any would be willing to pay the price for Dow Jones that Murdoch offered. Murdoch is an especially motivated buyer, having coveted the Journal for years. This deal is more about gaining clout than creating shareholder value.

The Bancrofts seemed to be letting their pride in owning one of the best newspapers in America get in the way of common sense. They better get while the getting is good. Otherwise, they are going to be stuck in the same rut they've been in for years.

It was the news as soon as I logged into my computer this morning from my West Coast office: Rupert Murdoch's News Corp. (NYSE: NWS) had made a whopping $5 billion bid for Dow Jones & Co. (NYSE: DJ). The bid was unsolicited and, it seems, entirely hostile to the Bancroft family, who controls Dow Jones and seems to be rejecting the generous offer.

It's a cute story, very Guys & Dolls. On one hand we have Dow Jones with its flagship brand, the Wall Street Journal. The paper is everything about wealth -- its very emblem the center of all the world's markets, Wall Street -- the editors are known for their conservative bent, the writers are known for their unparalleled and brainy research, even the design is known for its long-time avoidance of peripherals like color printing and photographs. On the other hand, we have Rupert Murdoch and his gang of vagabonds, from FOX broadcasting (need I really say more than "Next on FOX... Are You Smarter Than a Fifth Grader?") to the vast spoiled brat of recent acquisition MySpace. They're very other-side-of-the-tracks, the kind of news organization that would get a tattoo on its buttocks and then try to slip it in as the senior picture in the high school yearbook.

They're not a match made in heaven. They're a match made for Joe Millionaire, or Broadway. It's not real life; it wouldn't work. Whether or not the money is right, the styles are so vastly different, the respective organizations' reputations so opposite, any so-called "synergy" would be lost before the first page of the merger agreement was drafted.

Despite a blockbuster bid of $60 per share from News Corp. (NYSE: NWS), the stock price of Dow Jones and Co. (NYSE: DJ) ended the day at $56.20, a discount of more than 6% to the offer price. There is definitely a good amount of uncertainty on the offer (but it should be fertile ground for traders).

Now, according to a report from the Wall Street Journal [a paid service], it looks like a slight majority of the Bancroft family doesn't want to do the deal. And, in light of their super-voting power, that means they can kill it.

Why not support the deal? Well, I'm sure there's a lot of emotion involved. What's more, there's probably some skepticism of News Corp's leader, Rupert Murdoch. Might he turn Dow Jones into his personal soap box or make it schlocky?

Yet, this may be a way for the Bancrofts to get other suitors to the table.

The problem is that not many would likely pay Rupert's price.

Some of the possible buyers include Bloomberg, the Washington Post Co. (NYSE: WPO)., and the New York Times Co. (NYSE: NYT). Hey, there may be some wild cards like Google Inc. (NASDAQ: GOOG). After all, doesn't it like to pay premium prices?

Tom Taulli is the author of various books, including the Complete M&A Handbook and the EDGAR-Online Guide to Decoding Financial Statements.

The Bancroft family, Dow Jones & Co.'s (NYSE: DJ) controlling shareholders, rejected a $5 billion offer for the publisher of the Wall Street Journal from Rupert Murdoch's News Corp. (NYSE: NWS).

News of Murdoch's $60 sent shares of the New York-based media company skyrocketing. How the family can ignore a 65% premium over its Monday closing price is beyond me. This may have been the last hope for Dow Jones' long-suffering shareholders, those that didn't ride today's rally anyway.

As I argued earlier, it's unlikely that Murdoch did this without at least getting some indication that the Bancrofts might be interested in selling. MarketWatch says the Australian billionaire's overture "appears to have been narrowly" rejected, without explaining itself further.

Murdoch doesn't have many options since the Bancrofts, like the New York Times Co.'s Sulzbergers (NYSE: NYT), control Dow Jones through a dual class stock ownership system. This story isn't over yet.

Dow Jones, whose Wall Street Journal editorial page regularly rails against trial lawyers, may get to know quite a few of them soon. The board is going to have lots of explaining to do.

Meanwhile, I would like to offer my condolences to anyone who bought shares of Dow Jones or other newspaper stocks on this rally.