By Frank Ahrens
Washington Post Staff Writer
Friday, December 7, 2007

Rupert Murdoch is moving his people into place at the helm of Dow Jones and its Wall Street Journal one week before company shareholders are expected to approve the takeover bid from Murdoch's News Corp.

Times of London editor Robert Thomson, Murdoch's adviser, will become publisher of the Journal, according to a person close to the situation who spoke on condition of anonymity because an announcement has not been made. News Corp. executive Les Hinton will take Richard F. Zannino's job as chief executive of Dow Jones, the person said.

At the same time, Murdoch's youngest son, James, is set to step down as chief executive of News Corp.'s British Sky Broadcasting network in England to take over News Corp.'s entire Europe and Asia operations, likely moving him ahead of older brother Lachlan to eventually succeed their father at the top of News Corp., the person said.

News Corp. declined to comment.

Yesterday, Dow Jones announced that Zannino, the man who had a breakfast meeting with Murdoch in March that led to the media mogul's eventual purchase of Dow Jones, would resign.

Zannino, 49, who became chief executive early last year, is to receive a severance package worth about $20 million, which includes a lump-sum payment of $3.4 million and a $5.2 million "golden parachute," according to Securities and Exchange Commission filings. Included in the package is $11 million worth of stock and options for which Zannino will be paid.

Under Thomson's editorship of the Times of London, the one-time paper of Britain's upper crust (motto: "The Top People's Paper") became more "democratic," he has said. At the same time, Murdoch invested to boost its foreign coverage.

Hinton, a longtime newspaperman and Murdoch's confidant, is executive chairman of News International, the News Corp. division that runs the Times of London and the company's racy British tabloids.

When Zannino took over, he promised to raise the value and stock price of the company, which had been stuck at about $35 per share for more than a year.

The biggest boost Zannino was able to give the company's stock was the buyout resulting from the meeting with Murdoch. When Murdoch's $60-per-share offer for the company became public May 1, Dow Jones stock shot from $37.12 to $56 per share in one day, pushing as high as $61.76 per share in June.

The stock closed up 8 cents yesterday, at $59.97 per share.

Dow Jones shareholders are set to vote next week on the $5.3 billion acquisition by News Corp., which would form the world's second-largest media company behind Time Warner. The transaction has been approved by the boards of both companies.

Murdoch has said he wants to stop charging for use of the Journal's Web site and to start distributing Journal content across his global media empire, which includes the Fox television network, 20th Century Fox movie studios, the MySpace social-networking site and satellite television networks in Asia and Europe.

"Dow Jones is about to begin a new chapter," Zannino said in a statement yesterday. "Dow Jones fits perfectly into News Corp., and Rupert and I have been discussing since September my moving on from the company after the closing."