MySpace Founder, Brad Greenspan will lead an investment group seeking to take a non-controlling stake in the Dow Jones Corporation, through a letter delivered to its Board of Directors.
The letter contained following proposal: -- JI would commit to purchasing approximately 25% of outstanding Dow Jones common stock at a price of $60 per share. The structure of the transaction would be similar in nature to a "Dutch Auction" in which all shareholders could choose to tender their shares at the $60 price. Shareholders would also have the right not to sell any of their shares. On a pro rata basis, JI would purchase shares from all shareholders tendering their shares until it had acquired an aggregate amount totaling $1.25 billion. -- Separately, JI would purchase $250 million in common stock from Dow Jones at a price of $60 per share. This investment would provide the company with capital necessary to pursue the expansion of high growth opportunities in internet/digital/broadcasting areas. -- Two seats would be added to the Dow Jones Board of Directors to be filled by individuals of JI's choosing with specific expertise in internet/digital/broadcasting industries.
Mr. Greenspan's commentary included: ''Our proposal to take a non-controlling stake in Dow Jones stands as an attractive alternative to the current options as a vehicle for maximizing shareholder value. Our proposal is based on our strong belief that significant shareholder value can be created by more effectively leveraging the brands and electronic media assets of Dow Jones. I have successfully built a number of Internet franchises, including MySpace, and in studying the assets of Dow Jones, I believe the potential exists to significantly enhance the company's presence and revenue streams in electronic media.''
The merits of the JI proposal include the following: -- Creates significant immediate value for current shareholders by providing a premium liquidity event at $60 per share -- Enables the Dow Jones and Wall Street Journal operations to remain independent from other media conglomerates -- Provides a capital infusion to enable Dow Jones to aggressively pursue the expansion of its electronic media revenue streams -- Contributes the expertise necessary to unlock the value in Dow Jones' digital assets -- Provides further opportunities for outsized shareholder returns as the new digital strategy is implemented.
Mr. Greenspan continued, ''We believe our proposal is a great opportunity to put a solution together that can keep Dow Jones independent and able to firmly hold on to its culture of integrity and high quality reporting, while at the same time being beneficial to all of the company's stakeholders. We hope to engage in a dialogue with the Board of Directors in order to: 1) get feedback on how we might evolve our proposal if necessary to meet all of the company's goals with respect to considering a strategic transaction; and 2) provide more detail on the strategic value that JI would provide as a partner and our ability to help the company maximize the value of its digital assets. It is worth noting that my last effort to unlock shareholder value and provide an alternative transaction to shareholders was in September 2005 when my investment group lost a bid to keep MySpace as an independent publicly traded company. If our bid had been accepted, we estimate that shareholders would have seen the value of their stock increase by more than 40x within 18 months, instead of the $327 million cash out value they ended up receiving for their MySpace holdings. I believe we have similar value creating opportunities with our strategic investment in Dow Jones Corp.''
Mr. Greenspan concluded, ''Finally, as our goal is also to maximize the post-transaction value JI brings to Dow Jones Corp. we are open to considering participation by other interested strategic parties that can facilitate additional online or broadcast distribution.''
Brad Greenspan is a Los Angeles-based Internet Entrepreneur and the Founder of MySpace. Greenspan currently has majority stakes in privately held Live Universe, Inc. and BroadWebAsia, which in aggregate are composed of over 30 websites that reach approximately 75 million unique users each month across the U.S./Europe/Asia.
MySpace, a unit of Fox Interactive Media Inc., is a lifestyle portal for connecting with friends and discovering popular culture. By integrating web profiles, blogs, instant messaging, e-mail, music streaming, music videos, photo galleries, classified listings, events, groups, college communities and member forums, MySpace has created a connected community. As the second ranked web domain in terms of page views, MySpace.com is the most widely.
The letter contained following proposal: -- JI would commit to purchasing approximately 25% of outstanding Dow Jones common stock at a price of $60 per share. The structure of the transaction would be similar in nature to a "Dutch Auction" in which all shareholders could choose to tender their shares at the $60 price. Shareholders would also have the right not to sell any of their shares. On a pro rata basis, JI would purchase shares from all shareholders tendering their shares until it had acquired an aggregate amount totaling $1.25 billion. -- Separately, JI would purchase $250 million in common stock from Dow Jones at a price of $60 per share. This investment would provide the company with capital necessary to pursue the expansion of high growth opportunities in internet/digital/broadcasting areas. -- Two seats would be added to the Dow Jones Board of Directors to be filled by individuals of JI's choosing with specific expertise in internet/digital/broadcasting industries.
Mr. Greenspan's commentary included: ''Our proposal to take a non-controlling stake in Dow Jones stands as an attractive alternative to the current options as a vehicle for maximizing shareholder value. Our proposal is based on our strong belief that significant shareholder value can be created by more effectively leveraging the brands and electronic media assets of Dow Jones. I have successfully built a number of Internet franchises, including MySpace, and in studying the assets of Dow Jones, I believe the potential exists to significantly enhance the company's presence and revenue streams in electronic media.''
The merits of the JI proposal include the following: -- Creates significant immediate value for current shareholders by providing a premium liquidity event at $60 per share -- Enables the Dow Jones and Wall Street Journal operations to remain independent from other media conglomerates -- Provides a capital infusion to enable Dow Jones to aggressively pursue the expansion of its electronic media revenue streams -- Contributes the expertise necessary to unlock the value in Dow Jones' digital assets -- Provides further opportunities for outsized shareholder returns as the new digital strategy is implemented.
Mr. Greenspan continued, ''We believe our proposal is a great opportunity to put a solution together that can keep Dow Jones independent and able to firmly hold on to its culture of integrity and high quality reporting, while at the same time being beneficial to all of the company's stakeholders. We hope to engage in a dialogue with the Board of Directors in order to: 1) get feedback on how we might evolve our proposal if necessary to meet all of the company's goals with respect to considering a strategic transaction; and 2) provide more detail on the strategic value that JI would provide as a partner and our ability to help the company maximize the value of its digital assets. It is worth noting that my last effort to unlock shareholder value and provide an alternative transaction to shareholders was in September 2005 when my investment group lost a bid to keep MySpace as an independent publicly traded company. If our bid had been accepted, we estimate that shareholders would have seen the value of their stock increase by more than 40x within 18 months, instead of the $327 million cash out value they ended up receiving for their MySpace holdings. I believe we have similar value creating opportunities with our strategic investment in Dow Jones Corp.''
Mr. Greenspan concluded, ''Finally, as our goal is also to maximize the post-transaction value JI brings to Dow Jones Corp. we are open to considering participation by other interested strategic parties that can facilitate additional online or broadcast distribution.''
Brad Greenspan is a Los Angeles-based Internet Entrepreneur and the Founder of MySpace. Greenspan currently has majority stakes in privately held Live Universe, Inc. and BroadWebAsia, which in aggregate are composed of over 30 websites that reach approximately 75 million unique users each month across the U.S./Europe/Asia.
MySpace, a unit of Fox Interactive Media Inc., is a lifestyle portal for connecting with friends and discovering popular culture. By integrating web profiles, blogs, instant messaging, e-mail, music streaming, music videos, photo galleries, classified listings, events, groups, college communities and member forums, MySpace has created a connected community. As the second ranked web domain in terms of page views, MySpace.com is the most widely.
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