Investor Praises News Corp.'s 'Reasonable' Dow Jones Bid

Dow Jones
Dow Jones

Everyone has an opinion about News Corp.'s $60 bid for Dow Jones. But two "Street Signs" guests may have a bit more insight than most: Providence Capital President Herbert Denton, who sits on the board of Sun Times Media (formerly Hollinger); and John Linehan, portfolio manager at T. Rowe Price -- the largest institutional shareholder in Dow Jones. They shared their views with CNBC's Erin Burnett.

Denton told Burnett the question of the bid is "out of the hands of the Bancroft family" -- just as "Hollinger International came out of the hands of Lord Black," the tycoon who once controlled it.

Though the Bancroft clan controls 64% of Dow Jones' voting stock, Denton notes that the board has 16 members -- nine placed by the Bancrofts -- and "all members have a fiduciary duty to all public shareholders." But he said "at 16 times EBITDA and 10 times EBITDA world," the board will not turn down the bid outright.

Linehan, who manages the T. Rowe Price Value Fund, said he's "glad someone else sees the same value we see" in Dow Jones. How high does he value the company? "As for the exact dollar amount, we'll let market forces play out," he said. But, Linehan added, $60 is "a reasonable price."


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