All that's left is for the ink to dry ... unless the family brandishes the Wite-Out.

According to The Wall Street Journal, the boards of News Corp. (NYSE:NWS) and Dow Jones (NYSE:DJ) have reached a tentative agreement that would sell the company to Rupert Murdoch for the same $5 billion he bid in May.

If true, it would be a crowning achievement for Murdoch, who has spent years building a global media empire that includes the New York Post, the Times of London, and the Fox cable network.

And it would alter the competitive dynamics of financial news. CNBC would have to contend with a well-armed Fox Business News channel. Reuters would have to contend with a global army of Dow Jones Newswires reporters. And Pearson plc would have stiff new competition for its Financial Times in Europe.

But that's only if there's a deal. Right now, there isn't one. The Journal reports that the Bancroft family, which controls 64% of the voting stock, may not take kindly to News Corp.'s unwillingness to raise its bid and may refuse to sell as a result. At the very least, it's worth noting that billionaire Ron Burkle has been mulling a rival bid for Dow Jones.

Murdoch shouldn't capitulate by raising News Corp.'s bid. All he can do is lose if he does.

Why? Two reasons: valuation ... and valuation. By my math, Dow Jones is worth, at best, $56 a share. But that assumes 13% cash flow growth for at least the next five years -- a pretty optimistic view when you consider how newspapers are under assault from Google (NASDAQ:GOOG) and its peers.

More realistic may be the group that compares Dow Jones to Tribune (NYSE:TRB), Gannett (NYSE:GCI), and New York Times (NYSE:NYT). For them, McClatchy's (NYSE:MNI) $4.5 billion buyout of Knight Ridder, made at 1.49 times revenue, is instructive. Assigning the same multiple to Dow Jones would value the company at $2.8 billion, or $33 a share.

I've never agreed that Dow Jones is in the same league as the other newspapers. In fact, I think it's in much better shape. And I see broad -- oh, how I hate using this next word -- "synergy" between Dow Jones and News Corp. Murdoch will squeeze more than enough value out of the company to justify bidding $5 billion. But not one penny more.

Which brings me back to the Bancrofts. They don't want to sell? Fine. Let them be, Rupert. The minute you raise your bid, all bets are off. The bidding war will begin -- a war that, by the numbers, isn't worth fighting.

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Fool contributor Tim Beyers is black and blue and red all over from his vacation last weekend. Tim didn't own shares in any of the companies mentioned in this article at the time of publication. Find Tim's portfolio here and his latest blog commentary here. The Motley Fool's disclosure policy is on assignment for your portfolio.