Bancrofts Consider 'Wall Street Journal' Sale
STEVE INSKEEP, host:
It's MORNING EDITION from NPR News. Good morning, I'm Steve Inskeep.
Well, the Bancroft family meets today in Boston to consider Rupert Murdoch's $5 billion bid to buy their company, Dow Jones, which publishes the Wall Street Journal. This vote will affect the future of one of America's most important newspapers, and it involves 35 members of the Bancroft family as well as representatives from about 100 family trusts that control the majority of voting shares. Last week, the Dow Jones board endorsed a deal to sell the company, so now it's up to the owners.
Joining us now is NPR media correspondent David Folkenflik. David, good morning.
DAVID FOLKENFLIK: Good morning, Steve.
INSKEEP: Obviously lots of players here, but can you take us through a few of the most important ones?
FOLKENFLIK: Well, there are lots of players, and there are schisms in different ways: different braches of the family, different generations of the family. A couple of key players here. Christopher Bancroft is a board member. He is an Internet investor outside of Dallas. And he left the meeting last week at which the board of directors of Dow Jones endorsed this deal early because he's trying to line up opposition to it and he's trying to line up alternatives to it.
He has an ally in a cousin of his, Leslie Hill, who's a retired American Airlines pilot. There are these posters up on reporters' desks at the Wall Street Journal that say, I fly with Leslie. On the other hand, Lisa Steele, another cousin, another board member, different wing of the family - she reluctantly - she's known as this very civic minded, helping to redevelop downtown Burlington, Vermont - reluctantly came to the conclusion that it might be best for Murdoch to own the company, that he might be a more responsible steward of its financial fortunes than past management has been at Dow Jones.
INSKEEP: I guess the difference between family members comes from the fact that the paper and the company haven't made as much money as some people think it should have, it's not healthy as some people think it should have, but they're afraid that Rupert Murdoch will ruin the newspaper.
FOLKENFLIK: Well, that's right. You've got these competing balances where the company's undergone some tough stretches. Some of which are similar to the rest of newspaper industry. But some of which have been the result of the management's past blunders, failure to take care of opportunity. There's also real frustration the company's at this position where it is vulnerable to a big offer like this at high premium above what many see as sort of a depressed stock value.
INSKEEP: So, given those past blunders, do the opponents really have the votes to send away Rupert Murdoch and his $5 billion?
FOLKENFLIK: Well, this is gut check time for the extended Bancroft family. After all, there's this incredible, proud, century-long tradition of editorial independence. You know, Rupert Murdoch has a reputation - a hard one, many say - for meddling in the editorial content of his media outlets, including the prestige outlets like Times of London.
At this point, they've got to decide are they going to accept this offer, which, after all, would be worth bout $1.2 billion to the extended Bancroft clan. Or are they going to turn it down, walk away and, you know, among other things, face the wrath of all these other shareholders, the non-Bancroft family, who control about high 20 percent of the voting shares and who would desperately like to sort of cash in on this.
INSKEEP: Do the shareholders and the family members here have the final word? If they say yes, this sale goes ahead. If they say no, the sale is dead.
FOLKENFLIK: It's pretty much up to the Bancroft family. They control approximately 64 percent of the voting shares of the Dow Jones company, so it's them.
INSKEEP: And would Rupert Murdoch come back with an even higher offer? Is it possible that could happen if he gets rejected here?
FOLKENFLIK: He is a master of brinkmanship. He said that he needs sufficient support from the Bancroft family to press ahead. But you never know with him. If he really wants it, he could always come back.
INSKEEP: Although his position now, you're saying, is that if they say no, I'm done. I'm walking away. I'm taking my money.
FOLKENFLIK: That's what he said.
INSKEEP: We've been listening to NPR media correspondent David Folkenflik who's covering the possible sale of the Wall Street Journal and the company that owns it. David, thanks very much.
FOLKENFLIK: You bet.