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Murdoch 'close' to Dow Jones deal | |
(about 10 hours later) | |
Rupert Murdoch's News Corporation is moving closer to a deal to buy US media group Dow Jones, the Dow-owned Wall Street Journal (WSJ) has reported. | |
Its $5bn (£2.6bn) bid was in peril when a Monday deadline passed for members of the Bancroft family - which controls the firm - to decide on the bid. | |
News Corp reacted by saying it was "highly unlikely" a bid would go ahead. | |
But the WSJ said an arrangement whereby Dow Jones may pay $30m in deal-related costs could sway some family members. | |
Down to the wire | |
According to the newspaper, News Corp's board will meet later on Monday to decide whether to proceed with the bid and force Dow Jones shareholders to vote on the deal. | |
The bid has attracted criticism from figures within the media industry who believe it could threaten the Wall Street Journal's editorial independence, although News Corp has vowed to uphold the paper's independence. | |
The WSJ reported that Bancroft family members controlling 29% of voting shares in the firm now favoured a deal. | |
Taking into account non-family members said to favour a deal, this could give News Corp control of the business. | |
Bancroft members control 64% of the firm's shares through a variety of trusts and are split over the merits of the deal. | |
The WSJ said that the position of Christopher Bancroft and a number of trusts was likely to be vital in determining the success of the bid. | |
It said discussions were hingeing on a proposal for the Dow Jones board to create a fund to cover the Bancrofts' expenditure on corporate advisory fees, thought to be about $30m. | |
News Corp first tabled its bid for Dow Jones on 1 May. It has since won the backing of Dow Jones' board, although one director subsequently resigned in protest. | |
A rival suitor is waiting in the wings, with Brad Greenspan, founder of the MySpace social network, saying he has gained the backing of five investors interested in buying a stake in Dow Jones to thwart News Corp's bid. |