Ron Burkle to Work with Dow Jones Union on Alternatives to Murdoch Bid

Dow Jones shares touched a six-year high of $61.62 Tuesday after union representative Steven Yount said supermarket mogul Ron Burkle has agreed to assist the union in "exploring alternatives" to Rupert Murdoch's $60-per-share bid. Murdoch met with the controlling Bancroft family Monday in attempt to assuage their concerns about Dow Jones's editorial integrity under his stewardship. The Independent Association of Publishers' Employees [IAPE], which represents 2,000 Dow Jones employees, strongly opposes the Murdoch offer and is pursuing other potential suitors. Earlier this year, Burkle and Eli Broad tried to buy the Tribune Company but lost out to Sam Zell; and last year, Burkle's investment firm, Yucaipa, was involved in an unsuccessful bid for twelve Knight Ridder dailies. In what is widely viewed as a long shot, the union also approached Warren Buffett, who has already expressed reluctance to bid for Dow Jones in view of the steep premium Murdoch is offering. There is also speculation that Buffett, whose Berkshire Hathaway owns financial press release service Business Wire, does not want to risk a possible conflict of interest. Some analysts believe it is unlikely any other suitor, including Burkle, will be able to outbid Murdoch. "The union is understandably nervous but it looks like they're grasping for straws," said Hal Vogel, CEO of investment advisory company Vogel Capital. "These people aren't being realistic about what is happening in technology and print journalism."

Sources: IAPE press release, MarketWatch (I, II), Reuters, MoneyCentral, Bloomberg, Wall Street Journal, 24/7 Wall Street
Commentary: Murdoch: Meeting with Bancrofts Was "Constructive" • Smoking Out Suitors for Dow Jones [BW] • Newspaper War? Burkle vs . Murdoch [Newsweek]
Stocks/ETFs to watch: News Corp. (NWS), Dow Jones & Company, Inc. (DJ). ETFs: PowerShares Dynamic Media Portfolio ETF (PBS)
Conference call transcripts: Dow Jones Q1 2007, News Corporation F3Q07
Related: IAPE website, Ron Burkle on Wikipedia

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