• by Erik Sass  @eriksass1, July 9, 2007

The Dow Jones board has agreed to let Rupert Murdoch acquire the company, according to a report Friday from a British news magazine called The Business, which cited sources close to the Dow Jones board who were acting as its representatives in financial dealings. According to the same report, the price (roughly $5 billion) and provisions to secure the editorial integrity of DJ's various publications, including The Wall Street Journal, have all been agreed upon. Dow Jones immediately denied the report, but refused to detail what specific parts of the story were incorrect.

Later, the company elaborated that the negotiations had yet to settle on a price, but as there are no other bidders and Murdoch is offering a 67% premium over the current stock price of $36, it seems likely that both the board and the Bancroft family--which controls most of the company's voting shares--will find the terms acceptable.

Murdoch reportedly wants the newspaper to help bolster his new Fox Business Channel, which will debut this fall. For now, CNBC uses Journal reporters and enjoys the cachet the association brings. Dow Jones stands out as an unusually strong player in the newspaper field. After several hard years earlier this decade, the company has turned around revenue declines through aggressive development of its online presence, combined with hard-eyed cost-cutting initiatives in other sectors.

During the first quarter of 2007, 30% growth in online revenues drove an overall year-over-year revenue increase of 17.9%, to $507.2 million. During the company's conference call for fourth-quarter 2006, CEO Rich Zannino noted that online had grown to represent 30% of annual revenues, predicting that it would represent 40% by the end of 2007. In this context, it's not too hard to imagine online revenues eventually surpassing print in the future.