The world’s most famous stock index, the Dow Jones Industrial Average, may get a new owner and possibly a name change after 113 years, if Rupert Murdoch’s News Corporation follows through on selling its stock-index business.
The Wall Street Journal, owned by Dow Jones until its sale to News Corporation in 2007, has reported the company is exploring a sale of the unit.
Goldman Sachs has been hired to evaluate deals that may fetch $US700 million and prompt a new moniker for the flagship index. The Journal says potential buyers are MSCI, a former unit of Morgan Stanley, NYSE Euronext and Bloomberg.
The Dow, a basket of 30 stocks, was.introduced in 1896 by Charles Dow – a precursor version of mostly railroad companies started publishing in 1884 – and was designed to give investors a snapshot at overall market activity.
It has spawned a number of more-focused offshoots, including transportation, real estate, and technology indexes.
The indexes business – which creates and licenses indexes for use on mutual funds, exchange-traded funds and other products – is a relatively stable and profitable unit for Dow Jones amid a period of steep revenue decline in its core newspaper franchise.
The Journal says a name change is far from certain, given its broad name recognition. The story quotes a “person familiar with the matter” as saying that any deal would likely require that the Dow Jones name remain.
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