Michael Price on Murdoch, Dow Jones and the Washington Post

Many admirers of great value investing managers will remember Michael Price from his days running the Mutual Series family of funds. He sold the fund family to Franklin Templeton in 1996 and left not long after.

Today he runs his own private outfit and, as a result, doesn't get (or want, for all I know) a lot of press. That's why this Bloomberg report catches my eye -- in it Price calls Dow Jones (DJ) a trophy and says it could wind up commanding $100 a share:

"Rupert will meet with the family over the next month, he'll schmooze them,'' Price said in an interview today in New York. "He'll smoke out other bidders.''

Then this a bit further along:

Mutual funds managed by Price owned a 6 percent stake in Dow Jones in 1997. He said in October of that year that the company should consider a merger with Washington Post Co., publisher of the namesake newspaper and Newsweek magazine.

That's interesting. Ken Auletta was interviewed by Charlie Rose about News Corp's (NWS) Murdoch's offer to Dow Jones. Auletta said he'd asked the Bancroft family about who they'd like to see running their company if they no longer wanted to. According to Auletta, they favored the Graham family of Washington Post (WPO) fame, followed by Bloomberg. Their last choice -- he said -- was Murdoch, and next-to-last was Gannett (GCI).

If pressure is somehow brought on the Bancrofts to sell Dow Jones, will we see the Washington Post Co. ride to the rescue?

Comments

[Victor Cook:]

Thank you for the link to the May 2, 2007 Bloomberg interview with Michael Price where he said Dow Jones is a trophy that "could be a $100 deal." It's particularly interesting to me, since at that time I wasn't following the story, and I missed his comment.

In my June 5th post on the "Dow Jones & Company: Anomaly or Hidden Value?" on this site I concluded that "Under the right leadership, four years out (with a discount rate of 12%) my analysis shows the present value of DJ is $75 a share or a little over $6 billion." The nominal price on which my 2010 price forecast was based is $118.

2007 Jun 09 01:01 PM