News Corp. Unexpectedly Drops Newsday Bid
Forbes.com Staff 05.10.08, 5:18 PM ET
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News Corp. spokeswoman Teri Everett hinted that the company was not prepared to get into a bidding war with Cablevision Systems Corp. (nyse: CVC - news - people ), and Mortimer Zuckerman's New York Daily News. Cablevision has reportedly offered $650 million for Newsday, while Zuckerman's offer is said to have matched Murdoch's.
"It became uneconomical for us to continue," Everett told the AP on Saturday.
As recently as Wednesday, Murdoch had said that negotiations were at an advanced stage, though he had also indicated that he wouldn't raise his bid (see " News Corp.: Newsday In The Bag")
News Corp., which completed its $5.2 billion purchase of Dow Jones Co. in December, had planned to combine Newsday's printing and distribution operations with its New York City newspaper, the New York Post, a move Murdoch had said would have improved News Corps'. cash flow by $100 million
Newsday is currently owned by Sam Zell's Tribune Co. (nyse: TRB - news - people ), the second largest U.S. newspaper group. Neither it nor Cablevision have commented on News Corp.'s withdrawal.
Murdoch's withdrawal would seem to leave Cablevision in pole position to acquire Newsday, though it has never run a newspaper. Its main business is in cable television systems, including on Long Island. It also owns Madison Square Garden and the New York Knicks basketball and Rangers ice hockey franchises.
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