Oh boy, BusinessWeek is for the sale.
Some of the arguments:
The Bancrofts may have voting control.
But the board still has a fiduciary duty to the rest of the shareholders at the company.
Because the premium from Murdoch’s News Corp. (NWS) is so substantial, directors could open themselves up to liability if they reject the bid and the stock price drops back from nearly $60 a share to $30 — or even lower.
The Bancroft family does have voting control over the company, but there’s “a limit to their ability to say no,” one shareholder told Betsy Streisand at U.S. News & World Report.
Zac Bissonette, one of the most active writers at AOL (NYSE: TWX – news)’s bloggingstocks, dug up the details behind the dilemma.
He looked through the company’s rules of corporate governance and found that the “principal duty” of the board and management is to make sure that the company is “well-managed in the interest of its shareholders.”
But the rules also say that the company should “protect and preserve the quality, independence, and integrity of its products and services.”
Then Bissonette writes that “those two stated goals may be in direct contradiction with each other as the company considers News Corp’s bid.”
The pressures will only grow if other bidders enter the fray and the price offered rises.
There’s a chance that the bidding will go much higher. At CFO.com, famed investor Michael Price, who owns a chunk of Dow Jones, says he thinks the bidding could go to $100 a share.