Dec. 13 (Bloomberg) -- Rupert Murdoch may take until the end of 2010 to show he was right to pay $5.2 billion for Dow Jones & Co. The takeover was completed today.

By that time, Murdoch's News Corp. should be able to double Dow Jones's pretax cash flow to $600 million, giving it a 12 percent return on the purchase, said Larry Haverty, a fund manager at Rye, New York-based Gamco Investors Inc. Dow Jones may start adding to News Corp.'s profit in 2009 following investments next year, said Laura Martin, an analyst at Soleil Securities in San Marino, California.

``It's not a quick strategy,'' said Haverty, who helps manage Gamco's $30 billion in assets, including $308.1 million of News Corp. shares as of Sept. 30. ``Where he's going, we're very comfortable with it. It's just going to take three years.''

Dow Jones shareholders with more than 60 percent of voting power approved the takeover today. Murdoch offered $60 a share, or 65 percent more than Dow Jones's stock price of $36.33 on April 30, to win over the Bancroft family that has controlled the New York-based company for more than 100 years. Until the Murdoch bid, the shares had dropped 53 percent since June 2000.

News Corp. Class A shares fell 10 cents to $20.70 at 4:03 p.m. in New York Stock Exchange composite trading. They have lost 3.6 percent this year. Dow Jones advanced 1 cent to $59.98.

Free Online Journal

In addition to the Wall Street Journal, the purchase adds Barron's, Dow Jones Newswires and the Factiva data service to News Corp.'s 110 newspapers, film and television studios, and the Fox television networks.

Murdoch said in November that one of his first steps will be to eliminate fees for the online Journal, at a cost of $50 million a year, to increase readership and advertising. He has said he plans to increase coverage of general news, politics and the arts in the U.S. print edition to take on the New York Times, and will upgrade international editions that he called ``a lot less than satisfactory.''

The Journal's Web site may get enough ad sales to make up for the loss of subscription fees once it gets 20 times more readers, Murdoch said today in an interview on Fox News. Luring the 20 million readers may take a year, he said.

``We're seeing in the world today, huge creation of wealth,'' Murdoch said on Fox News. ``There's going to be a huge hunger for financial and business information.''

James's Role

The biggest chances for growth will come from the Journal Web site and cable and satellite distribution of news outside the U.S., said UBS AG analyst Michael Morris, who recommends investors buy News Corp. shares and doesn't own them.

Last week, Murdoch, 76, named his son James to run News Corp. in Asia and Europe. James, who turns 35 today, stepped down as chief executive officer of British Sky Broadcasting Group Plc, 39 percent owned by News Corp., and rejoined News Corp.'s board.

Dow Jones CEO Richard Zannino said last week he would step down when the deal closes. He will be replaced by Leslie Hinton, chairman of the News International unit. Times of London editor Robert Thomson will replace Gordon Crovitz as the Journal's publisher, News Corp. said last week.

With subscriber fees dropped, the WSJ.com Web site has a ``significant'' opportunity to grow, said New York-based Morris. He cites Yahoo Inc.'s finance site, which has 30 times more users than WSJ.com and projected 2008 ad revenue of $250 million to $300 million.

Higher Returns

News from the Journal, the second-biggest U.S. newspaper by circulation, may help News Corp.'s Fox Business Network challenge General Electric Co.'s CNBC and Bloomberg Television, owned by Bloomberg LP.

``If the success of Fox Business News is anywhere close to Fox News, it's a home run,'' said Haverty, who projects the shares will top $30. The business channel started on Oct. 15.

It will take three to four years for the channel to secure distribution that News Corp. took seven years to get for Fox News, Murdoch said today. Fox News, created in 1996, overtook Time Warner's CNN as the most-watched cable news network in 2002.

Eventually, Dow Jones may generate returns similar to those of other News Corp. newspapers, said Soleil's Martin. In the year ended June 30, operating profit at News Corp.'s newspaper division rose 26 percent to $653 million, producing a 15 percent margin on sales of $4.49 billion. Dow Jones had an operating margin of 8.3 percent last year excluding restructuring costs.

`Permanent Decline'

That won't happen until 2009 or later, after Murdoch has invested in Dow Jones for two or three years, said Martin, who has tracked media companies for 20 years. She recommends investors sell News Corp. shares and doesn't own them herself.

Signs of success with Dow Jones might persuade investors who sold News Corp. to reconsider. Jean-Marie Eveillard, a New York-based fund manager at First Eagle Global Fund, said he sold 4.8 million shares in recent months on concerns that newspapers are in ``permanent decline,'' that Murdoch overpaid for Dow Jones and that the stock had already gained considerably in the past two years.

Still, he's willing to give Murdoch another look and said he may buy the stock if it falls below $15.

``He makes bets and wins most of them,'' Eveillard said.

To contact the reporter on this story: Gillian Wee in New York at gwee3@bloomberg.net.

Last Updated: December 13, 2007 18:02 EST