It’s a deal. After nearly four months of negotiation, a lot of it in secret behind closed doors, Rupert Murdoch has been told told he is within a whisker of achieving his big ambition: owning the Wall Street Jourmal, America’s biggest selling and most influential financial daily.
He has secured , despite strong opposition, promises of enough shares to consumate the deal. But there’s a final price to pay, in addition to the $5 billion Murdoch originally offered, the American shareholders have demanded compensation for their legal fees. That could amount to an extra $30 million.
It’s not expected that this will scupper the deal – not at this stage. However News Corp is insisting that none of this money should go to shareholders who have refused to sell their shares.
The final moments of the drawn-out drama took place on both sides of the Atlantic, with meetings in London of News Corps executives and lawyers in the US representing the shareholders in Dow Jones, the company that has for almost a century owned the Wall Street Journal.
For two days it was touch-and-go. Even at the end there were some members of the Bancroft family, the principal shareholders, who didn’t want to sell. They feared, they said, what effect ownership by Murdoch would have on their long -cherished paper. At first they wouldn’t even officially respond to Murdoch’s offer – or even talk to him. Some observers labeled the negotiations not only convoluted but also byzantine
The final move came when a group of shareholders based in Texas – who control over nine per cent of the shares – decided to switch to Murdoch. Their decision turned the table – and virtually guaranteed Murdoch 40 per cent of the votes. About ten per cent more than he needed to clinch the deal. .
The shareholders apart, the staff of the WSJ and other sister publications – most of whom were also against the take-over – went through several nailbiting days. At the Journal’s office in New York and other cities many spent hours clustered around television and radio sets
There were no cheers – just groans – when the results of the shareholders’ votes became known. Some readers have already threatened to cancel their subscription. Nevertheless, shares in Dow Jones climbed on Wall Street yesterday.
What happens next? When final details of the deal are sorted out, Murdoch will turn his attention to his long projected plan to launch a new cable-tv business channel in the US. .A launch date has already been set: October 15.
It will be a rival to CNBC – an all business channel which at the moment leads the market. Murdoch believes he had can do better – especially if he has access to the Wall Street Journal’s news gathering facilities, and perhaps more importantly its news staff.
News Corp executives have spent several months designing the channel – which will be known as FBC . One of the people involved has been Brian Jones, who helped launch the Fox News Channel in l996 and later worked for the Republican National Committee and former President George H W Bush.
Already the new channel has contracts with enough cable systems – including Time Warner – to guarantee that it will be accessible to at least 30 million viewers when it makes it debut..