Rupert Murdoch's $5 billion (€3.6 billion) bid for the Wall Street Journal and its parent company, Dow Jones, faces a key test today when members of the Bancroft family, which has controlled the company for more than a century, meet in Boston to debate the offer.
The Dow Jones board wants to sell but the family, which controls 64 per cent of the voting rights, although it owns only 25 per cent of the company, is divided.
Mr Murdoch says he wants to use the resources of Dow Jones to provide financial news for his other media interests, including a new Fox Business Channel he will launch in October and promises to invest in boosting the Wall Street Journal's circulation and improving its web presence.
His offer of $60 a share was 67 per cent higher than the market price when he made it in April and some younger members of the Bancroft family are eager to accept it.
Mr Murdoch has agreed that an independent board should have a veto over senior appointments at the newspaper, although his News Corporation will retain the right to hire and fire editors. Sceptics within the family fear that Mr Murdoch will ignore the independent board, pointing out that a similar board charged with preserving the independence of the London Times and Sunday Times has had no impact since the Australian publisher bought those papers in 1981.
Those who oppose the sale received a boost last week when Dow Jones board director Dieter von Holzbrinck, heir to the German publishing empire that owns the weekly paper Die Zeit, resigned.
Mr von Holzbrinck said that, although Mr Murdoch's offer is "very generous in financial terms", he is "very worried" that Dow Jones' journalism could suffer.
Efforts to find alternative buyers for the company have so far proved unsuccessful, partly on account of the size of Mr Murdoch's offer. Dow Jones board members fear that if Mr Murdoch's offer is rejected, the company's share price will collapse, an anxiety shared by some Bancroft family members.
With almost all non-family shareholders supporting Mr Murdoch's bid, its fate depends on the size of the Bancroft family revolt.
Editorial Comment: page 15
