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                                             Dow Jones investor opposes Murdoch





By Joshua Chaffin and Aline van Duyn in New York
ft.com
Published: May 6 2007


A major Dow Jones shareholder on Sunday vehemently opposed a $5bn offer from News Corp, warning that Rupert Murdoch, the media giant’s chief executive, would endanger the integrity and editorial independence of The Wall Street Journal, its flagship title.

In a statement, James Ottaway Jr, a former Dow Jones board member, accused Mr Murdoch of using his media empire to further his personal and political agendas.

Mr Ottaway singled out News Corp’s Fox News Channel, saying it was “a unique example in American broadcasting in which one man’s political opinions have become the editorial and news policy of a major national news channel”.

He also said Mr Murdoch had to “kowtow” to the Chinese communist government, withholding criticism of its human rights abuses in order to win support for his Star TV business. “When Rupert Murdoch’s business and news interests conflict, his business interests usually prevail,” Mr Ottaway said.

Mr Ottaway’s opposition throws up an obstacle to Mr Murdoch’s campaign to acquire Dow Jones and add the Journal, one of the world’s most influential newspapers, to his media empire. Along with his family, Mr Ottaway owns 6.2 per cent of Dow Jones’ class B voting shares.

Last week, members of the Bancroft family, who control 64 per cent of those voting shares, banded together to reject an audacious $60 per share offer from Mr Murdoch, which represented a 65 per cent premium for the company. Since then, Mr Murdoch has been trying to arrange a meeting with the Bancrofts to make his case that he would be a responsible steward of an institution that has been associated with their family for more than a century.

As part of that campaign, Mr Murdoch has talked about his own family values. He has also sought to draw a distinction between his tabloid newspapers, such as The New York Post, and up-market publications like the Times of London. Last week, Robert Thomson, The Times’s editor, said: “People who know The Times and read The Times can sense the independence on every page, and clearly understand that there’s a very strict distinction between commentary and news.”

However, Mr Ottaway, who sold his family newspaper chain to Dow Jones in 1970 and has long been a champion of journalistic causes, was not persuaded. He dismissed Mr Murdoch’s interviews as a “charm offensive” and argued that Dow Jones was in a strong financial position and did not need to be sold.

Mr Ottaway’s comments were amplified by his son, James Wells Ottaway, who sent a letter on Sunday to the Bancrofts, lobbying them to oppose Mr Murdoch. He invoked the memory of Daniel Pearl, the Journal correspondent murdered by Islamic extremists in Pakistan.

“Mr Pearl gave his life pursuing the truth for a newspaper in which he so deeply believed,” Mr Ottaway wrote. “What would Daniel Pearl think of Dow Jones being sold a few years after his death to Rupert Murdoch?”

Meanwhile, it emerged over the weekend that the New York attorney-general and the Securities and Exchange Commission were examining the extraordinary volume of trading in Dow Jones options that preceded news of Mr Murdoch’s bid. Both News Corp and Dow Jones said they were co-operating.


http://www.ft.com/cms/s/b56820c2-fc16-11db-93a4-000b5df10621.html