We may never know who is the goat at The Wall Street Journal and/or Dow Jones Newswires who flubbed the key number -- the value of the transaction -- in yesterday's coverage of the blockbuster merger of Merck & Co. and Schering-Plough Corp.
While the two giant pharma companies put a price tag on the combination of $41.1 billion, WSJ.com and Dow Jones Newswire insisted for much of Monday that the true value of the cash-and-equity offer was only $32.6 billion.
In a WSJ.com post at Health Blog (2:13 p.m. yesterday), the Journal's Sarah Rubenstein wrote: "An update on the deal's size: Though Merck and Schering-Plough put it at $41.1 billion, it clocks in at $32.6 billion when taking into account only the cash and stock that Schering-Plough shareholders will received. "The other $8.5 billion is Schering-Plough debt that Merck will take on."
Oops! That was wrong.
As the Journal makes clear today in its front page coverage, the deal is valued at $41.1 billion and the $8.5 billion figure is actually debt that Merck is taking on to help pay for the transaction.
It's far from clear that Rubenstein is the goat. Or if she is, she's certainly not alone.
Other Journal and DJNS staffers who wrote stories yesterday relying on the erroneous $32.6 billion figure include Heidi N. Moore, James A. White and Peter Loftus.
Besides the obviously embarrassing question of how could the Journal have goofed up such an important fact and not caught itself all day long, the episode points to an important newsroom insight: reporters don't do enough of their own thinking, relying heavily on what their colleagues report.
Did any of the at least four reporters, including M&A expert Moore, ask their fellow reporters or editors the hard question of why the Journal was the only news organization to go with and stick with the $32.6 billion figure?
Like an infectious disease, once the Journal got the bug, it spread unchecked throughout the newsroom.
As usual, Health.NewsBios's request for comment or explanation from Journal reporters, editors and PR people has gone unanswered.
POST SCRIPT: Rather than append a correction to each and every erroneous post published yesterday at WSJ.com, the editors of the site mostly reposted the same stories with the corrected number included. One post, by James A. White, carries this note at its bottom: "Correction: Merck agreed to buy Schering-Plough for $41.1 billion in cash and stock. An earlier version of this post incorrectly said the deal was valued at $32.6 billion."
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