Internet Entrepreneur Greenspan Details Dow Jones Proposal
Internet entrepreneur Brad Greenspan on Friday outlined a new proposal to keep Dow Jones out of Rupert Murdoch's hands, saying his plan can help boost its stock price to above $100.
Urging shareholders to reject Murdoch's $5 billion takeover bid, Greenspan offered to lend members of Dow Jones' controlling Bancroft family $400 million to $600 million to buy out other Bancrofts seeking to cash out at $60 per share -- the price that Murdoch's News Corp.
Greenspan, an early investor in MySpace, also called for Dow Jones to take on an estimated $2.5 billion in debt to buy back 50 percent of its outstanding shares at $60 per share, and to take on another $500 million in debt to fund a digital expansion.
In an open letter to Dow Jones shareholders, Greenspan also talked about creating a cable and satellite financial news channel to rival CNBC and News Corp.'s to-be-launched Fox business channel.
"It's an oddball proposal," said Ken Doctor, a media analyst at Outsell Inc. "It's very late in the game."
Greenspan's vehicle for the deal is Journal Investment Group, but it was unclear if he had partners. A spokesman for Greenspan's entity could not elaborate. Greenspan could not immediately be reached.
His proposal comes days before a Bancroft family meeting on Monday in Boston to consider Murdoch's bid. The Bancrofts control the publisher of the Wall Street Journal newspaper by holding 64 percent of the company's voting stock.
Family members are expected to signal whether they support the deal on Monday, but the outcome is uncertain. An undetermined number of Bancrofts oppose it.
One of them, Dow Jones board member Christopher Bancroft, is seeking alternate proposals.
He and some of his relatives worry that Murdoch would meddle with Dow Jones's news operations in an attempt to further his business interests.
Dow Jones and News Corp. officials declined to comment. A Bancroft family spokesman had no immediate comment and Christopher Bancroft and an official from the Dow Jones employee's union did not return telephone calls.