Continuing Coverage of the Dow Jones Story
The price of the $5 billion offer by Rupert Murdoch for Dow Jones continues to be the most formidable obstacle in those wanting a possible stake in the company.
Microsoft (MSFT) was the first major company interested to say the economics of the deal make no sense. Now Jeffrey Immelt, chairman and CEO of General Electric (GE) has come to the same conclusion. General Electric and Pearson PLC said they are abandoning the pursuit of Dow Jones & Co. (DJ).
Every time a major player drops out of the race, it stregthens Murdoch's hand, and brings him one step closer to reaching his goal.
"Rupert, all along, has been the logical and only buyer for these assets, and the Bancrofts at this point would be well advised to entertain the offer," said Lawrence J. Haverty Jr., associate portfolio manager at Gamco Investors Inc. in Rye, New York. "No one will pay more."
What this probably does is eliminate the need to think in terms of increasing the bid as an incentive any longer. With Microsoft and GE out of the way, who would come in and bid more, or even want the company?
Murdoch has been quiet all along about what's been going on. That very silence speaks volumes. I think he's just letting the pressure build on the Bancrofts. The first crack in their armor showed through when they let the Dow Jones board take over negotiations.
About the only thing Murdoch has said is he won't pay $5 billion for the company and let others control it. That's the next thing his "silence" will work on.
Yesterday it was reported again that the Bancrofts were putting together a proposal to keep oversight of the company. The longer that goes on, the sillier they're starting to look. I think eventually that will weaken as pressure mounts to accept the offer that is far beyond the value of the company.
Related Coverage:
Bancrofts Out of the Dow Jones Negotiations - Board Takes Over
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
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» Dow Jones Board Drafting "Editorial Independence" Statement - Will Murdoch Accept? from ManagersRealm
Continuing Coverage of the Dow Jones StoryWith General Electric (GE) and Pearson PLC dropping out of the race for Dow Jones & Co. (DJ), it looks like there's nothing to stop Rupert Murdoch from moving ahead to victory. The offer... [Read More]
Tracked on: June 22, 2007 5:46 PM | Permalink to Trackback