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Continuing Coverage of the Dow Jones Deal

In one of the best decisions they've made as controllers of Dow Jones & Co. (DJ), the Bancroft family has decided to turn the negotiation responsibilities over to the company board.

This is smart in that the longer this went on, the more fragmented, and sometime foolish, the family began to look. There had to be some extraordinary pressures within the family circle as this went on. It's good for the family, and better for the business.

Possibly the latest bid by former MySpace (NWS-A) founder and CEO Brad Greenspan made the family realize they were over their head, as it brought another whole way of buying and operating the company into the picture. Greenspan offered the same $60 a share for the company, up to 25 percent ownership.

While Greenspan says this isn't revenge against Murdoch for getting MySpace cheaper than he had wanted to have it sold at, it does sound a little odd. He eventually filed a lawsuit against Intermix, which was thrown out of court. He had even offered more than Murdoch, which was rejected by the Intermix board.

What's odd about it is Greenspan wouldn't say how the deal would be funded, and added the group he represents is interviewing investment bankers. It sounds like he made an offer without any financing in place. While isn't necessarily unheard of, it does make it look pretty lame when considering Murdoch's solid offer.

There is also some baggage that accompanies Greenspan, as at the time he left Intermix (MySpace) there was an informal inquiry by the Securities and Exchange Commission (SEC) along with accounting restatements investigations.

With General Electric (GE) and Pearson PLC, they're only in the investigative and exploratory stages, and have some opposition already rearing its head if they try to get in a bidding war with Rupert Murdoch.

All of this speaks to the Bancrofts being in way over their head and focusing on the wrong thing like editorial control.

"The fact the board is taking over means they will move forward and resolve the issue," Ed Atorino, an analyst with Benchmark Co. in New York, said in an interview. "It says to me they will sell the company and negotiate the best outcome and not let the family bicker about things like editorial control."

This is good news for all parties involved. The board should move things along much quicker and cleaner.

"It's about time," said Michael Chren, managing director of Allegiant Asset Management Co. in Palm Beach Gardens, Florida, owner of 436,000 Dow Jones shares. "There was confusion among shareholders about how the process was being run, and probably among the Bancroft family and the board as well. I would expect we'll start to see a much cleaner and quicker process."

The only question will be whether the board will be a rubber stamp for the Bancrofts - with the only change being going through the process of negotiations - or if the board will have legitimate authority to make and confirm deals (obviously it would have to be approved by shareholders).

As a final thought, the family still said that their position (in reality partially) is for a deal to go through, it has to have the editorial safeguards in place.

It would be something if all of this takes place and certain Bancroft family members turn it down for the tired old reason of editorial safeguards. That would be worse than what is happening now.

If that were to happen, it may turn away all legitimate bidders for the company, as it would take on a circus atmosphere that it's already close to emulating.

Related Coverage:

General Electric, Pearson PLC Consortium to Buy Dow Jones Already Under Fire

Bancrofts Said to be Readying Proposal for Special Board

Another Dow Jones Suitor Bites the Dust

More Suitors for Dow Jones than Men Saying They were Father of Anna Nicole Smith's Baby

Brian Tierney Interested in Dow Jones

Union for Dow Jones Employees Claims Ron Burkle Joined Them to Battle Rupert Murdoch

Journalists Threaten to Walk Out if Murdoch Gets Dow Jones: Who Cares?

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