The far-flung Bancroft family met yesterday to review the five billion bucks offer from News Corporation and, within a week, decide whether to back a sale of Dow Jones & Co., which the family has controlled for 100 years. With the family fortune split so many ways, it is hard to predict whether the family will unite on a single position. Christopher Bancroft – one of the few heirs who actually carries the name – is a Dow Jones director and has been seeking an alternative to selling to Rupert Murdoch and News Corporation. But some of his cousins are apparently of the opinion that Murdoch's offer is attractive and that no good alternative is likely to emerge.
Meanwhile, Internet entrepreneur Brad Greenspan has sent Dow Jones shareholders his own proposal to keep the company independent and drive the stock price to 100 bucks, well above the 60 being offered by Rupert Murdoch and News Corporation. He noted the brand value of the Wall Street Journal in explaining his proposal. "Leveraging this leadership position and formula that has taken decades to build, Dow Jones is better positioned than any other company in the world to be the financial news leader bot online and on cable/satellite," Greenspan said in his letter. "Trumping CNBC would create five billion in incremental value for Dow Jones shareholders. A great target to shoot for, but even a much more conservative outcome provides significant incremental value for Dow Jones shareholders," he insisted. Greenspan's plan involves a "WSJ Video" site and having WSJ.com take on Yahoo! Finance head-to-head. His recapitalization plan would buy out half of the current shareholder base at 60 bucks per share, the same price as the Murdoch offer, and take on new debt to fund the digital initiatives, with two members of Greenspan's Journal Investment Group taking seats on the Dow Jones board of directors.
SmartMedia observation: It would be premature to call the Greenspan plan half-baked. It doesn't look like he has even fired up the oven. Just saying we'll do a cable network and some online sites is easy. We doubt that he has any idea how difficult and expensive it would be to get cable carriage for a new freestanding financial network. Certainly his claim that a Dow Jones News Channel would have a lower initial operating loss than the soon-to-launch Fox Business Channel, which has the benefit of being joined at the hip to other cable channels, just shows his lack of experience in the cable arena. The WSJ already has an extremely successful website, so why do they need Greenspan to help them move into online video?