Dow Jones and Germany's Holtzbrinck GmbH yesterday agreed to swap stakes in the Wall Street Journal Europe and Handelsblatt in a move analysts said was aimed at fending off UK rival the Financial Times.
In what the two media giants described as a non-cash deal, Holtzbrinck will take a 49 per cent stake in the Wall Street Journal Europe and Dow Jones 22 per cent of Handelsblatt, the leading German business daily.
Analysts said the agreement between the two longtime partners was a defensive reaction to rival Pearson Plc's plans to start a German language edition of the Financial Times.
"It's a purely defensive move, but it's a clever defensive move," said an analyst for a large US brokerage who asked not to be named. "Strategically it makes sense."
Pearson announced in March that it would team up with German media group Gruner+Jahr, a Bertelsmann unit, to produce the German FT. The paper doesn't have an official start date but is widely expected to begin appearing at the beginning of 2000.
The German FT has a daily circulation target of 150,000 compared to the Handelsblatt's current 160,000.
Dow Jones and Holtzbrinck said they aimed to double the Journal Europe's 70,000 circulation within five years, but that's still dwarfed by the English-language FT's European total of more than 300,000 copies.
