By Lisa Kerner
Charlotte, N.C., Aug. 1 - The Bancroft family is ready to relinquish its stake in Dow Jones & Co., agreeing to a $5.6 billion acquisition by Rupert Murdoch's News Corp.
Both companies' boards have approved the merger agreement, which gives Dow Jones stockholders $60.00 cash for each share of common stock and class B common stock.
Certain members of the Bancroft family and their related trusts, collectively owning some 37% of Dow Jones' stock, agreed to vote in favor of the transaction.
A five-member special committee will be established to assure "the continued journalistic and editorial integrity and independence of Dow Jones' publications and services," a company news release stated. Special committee members will include Louis Boccardi, Thomas Bray, Jennifer Dunn, Jack Fuller and Nicholas Negroponte.
Under the merger agreement, up to 250 holders of record and not more than 10% of the shares of Dow Jones may elect to have their shares of Dow Jones equity converted into a number of class B units of Newco LLC, a newly formed subsidiary of News Corp. The number of class B units of Newco issuable in exchange for each share of Dow Jones common stock will be based on an exchange ratio.
A termination fee of $165 million is included as part of the agreement.
The transaction is slated to be completed in the fourth quarter, subject to Dow Jones shareholder approval.
Following the merger's close, News Corp. will appoint a Bancroft family member or "another mutually acceptable person" to its board of directors.
"Given the Bancrofts' long and distinguished history as custodians of Dow Jones, we appreciate how difficult this decision was for some family members," Murdoch, News Corp.'s chairman and chief executive officer, stated in the release.
"I want to offer the Bancrofts my thanks, and an assurance that our company and my family will be equally strong custodians."'
"The transaction will deliver significant returns to our shareholders," Dow Jones CEO Richard F. Zannino added.
"It will also build on our recent, industry-leading earnings growth and make our company and journalism even stronger as our strengths are leveraged across News Corp.'s powerful global distribution and marketing platforms for the benefit of our readers and other customers."
Dow Jones was advised by Goldman, Sachs & Co. and Fried, Frank, Harris, Shriver & Jacobson LLP. JPMorgan, Allen & Co., Centerview Partners, Skadden, Arps, Slate, Meagher & Flom LLP and Hogan & Hartson LLP advised News Corp.
Dow Jones is a provider of business news and information services based in New York.
News Corp. is a New York-based vertically integrated media company.
| Acquirer: | News Corp.
|
| Target: | Dow Jones & Co.
|
| Transaction total: | $5.6 billion
|
| Price per share: | $60.00
|
| Termination fee: | $165 million
|
| Announcement date: | Aug. 1
|
| Expected closing: | Fourth quarter of 2007
|
| Stock price for target: | NYSE: DJ: $57.38 on July 31
|
© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere.
For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.
