Bancroft Clan Squashes Rupert’s $5 Billion Dow Bid

It seemed, for a few hours on the afternoon of May 1, as though Rupert Murdoch was about to fulfill a fantasy he’d been developing for more than 10 years.

It was a little before noon when David Faber broke the news on the CNBC show Squawk Box that Mr. Murdoch’s News Corp. had tendered an offer to buy Dow Jones Inc., which owns a raft of media properties including The Wall Street Journal, from the Bancroft family, which has controlled the company since the 1920’s.

And it was around 7 p.m. that the Bancrofts told their representative on the company’s board, Michael B. Elefante, to tell the board that the family planned to use its controlling interest to block the $5 billion bid.

Even for someone like Rupert Murdoch, some things are apparently out of reach.

In the newsroom, the panic started shortly after Mr. Faber’s revelation that a well-placed source had advised him of Mr. Murdoch’s aggressive bid: At $60 a share, he had met the price long rumored to be in the heads of the scattered Bancroft family shareholders. He had also exceeded the trading price of Dow Jones stock by 67 percent.

One staffer received a phone call from his friend, Josh Quittner, the editor of Business 2.0.

“I asked, ‘Are you looking forward to having Murdoch as your new boss?’” Mr. Quittner recalled. “My friend replied, ‘I just launched a page on MySpace: ‘I love unicorns, rainbows and Sean Hannity.’”

“It’s out of the frying pan and into a thermonuclear blast,” said one Journal staffer. “This was the worst-case scenario—other than being sold to Vladimir Putin.”

“I think it’s safe to say there was a fairly uniform, panicked reaction that rippled through the newsroom,” said another.

Around noon, Steve Yount, president of Local 1096 of the Independent Association of Publishers’ Employees (the union that represents Dow Jones employees), drafted a letter condemning the deal, which he circulated to four or five other union leaders and communication staff.