The Discerning Texan

There was considerable dissent among the various Bancroft heirs over Murdoch's offer to buy them out. Murdoch's $60-a-share bid was a 67% premium over what the stock had been trading for. Many family members took the attitude that they are duty-bound to guard the independence of the newspaper, regardless of the personal financial cost. The same concept that inspired and has governed the Ochs/Sulzberger voting trust arrangements.

But enough Bancrofts listened to one of their own, Crawford Hill, to swing the balance over to those who want to authorize a sale of their stock. Hill wrote family members a nearly 4,000-word email that stated it was time for a "reality check" - that the days of being able to go it alone as an independent newspaper publisher are drawing to an end. An appeal to greed alone was probably not enough. The Bancrofts have other money besides the Dow Jones stock. But an argument that merger would allow the proud heritage of the paper to flourish as it could not under independent management had to ease at least some of the pangs that would accompany a big cash payout.

This sets a very, very bad example for Pinch's aunts, uncles, cousins, and other assorted relatives.

In the short run, it is unlikely that enough Sulzbergers will become interested in selling their company to enable Murdoch or anyone else to make a successful bid. And the Sulzbergers arranged their family trusts differently than the Bancrofts, so that it will be more difficult for any potential acquirer to persuade enough of them to carry the day and enable a sale. But Pinch's glaring failures as a business leader will chafe at family members if the acquisition of the Wall Street Journal maintains the paper's standards and standing and enhances its business performance.

If Pinch cannot deliver better business results, he may see his cousin Michael Golden, vice-chairman and publisher of the subsidiary International Herald-Tribune, move out of the wings where he has been waiting into the chairman's office in the lavish new headquarters Pinch built for his shrinking company, probably forcing Pinch into a lesser role, or maybe into a face-saving early retirement. An outright sale of the company is unlikely for now, unless it consists of a friendly sale to one or more wealthy leftists, who conceivably could take the company private, buying out the public shareholders and dispensing with the embarrassment of publicly reporting financial results.

Labels: Media War, NY Times, Wall Street Journal