Murdoch Moving to Buy Newsday for $580 Million

By RICHARD PÉREZ-PEÑA and TIM ARANGO–
New York Times: April 23, 2008–

Rupert Murdoch is moving to tighten his already-imposing grip on American news media, striking a tentative deal to buy his third New York-based paper, Newsday, and getting his first chance to appoint the top editor of The Wall Street Journal, after the resignation of the editor on Tuesday.

His $580 million bid for Newsday and his urgency in remaking The Journal worry his competitors and cause angst in many newsrooms, including his own. And both moves are vintage Rupert Murdoch, a man who operates his sprawling News Corporation like an old-style media mogul, making big bets on old and new media — bankrolling the new Fox Business Network, aggressively pursuing a deal for Yahoo, and buying Dow Jones & Company, publisher of The Journal, for far more than analysts thought it was worth. And that was just in the last year.

His first love, however, remains newspapers. The purchase of Newsday from the Tribune Company would put Mr. Murdoch in control of 3 of the nation’s 10 largest-circulation papers (the others being The Journal and The New York Post). Owning Newsday, which is based on Long Island, would also open an eastern front in the long-running battle for New York tabloid supremacy and, by combining some operations, could allow News Corporation to end decades of heavy losses by The Post.

But the agreement is far from final as competing bidders consider their positions. Mortimer B. Zuckerman, owner of The Daily News, the archrival of The Post, will make a counteroffer next week, according to people involved in the bidding who would not be identified because of the confidentiality of the talks. Representatives of another bidder, the Observer Media Group, publisher of The New York Observer, plan to meet in a few days with Cablevision — which had dropped out of the bidding — to discuss a joint offer.

People in both the News and Observer camps say they were shocked to learn of the handshake deal with Mr. Murdoch, first reported by The Chicago Tribune and The Journal, because they had been assured by Tribune’s bankers that they had until next week to submit offers. In addition, a takeover of Newsday by News Corporation, which also owns two New York City television stations, could face trouble with regulators.