Offers today for Boston Globe - a snip at $100 million as New York Times looks back at $1.1 billion buy
The New York Times is accepting bids for the Boston Globe today - but the best is likely to be about $100 million - one tenth of the $1.1 billion the Times paid for the company 20 years ago, according to Bloomberg.
For sale, just $100 million?
In 2009 the Time threatened to close the paper unless unions agreed to concessions. Cuts were made - but still the Globe has finished up back on the block.
Bloomberg quoting sources says potential buyers include Rick Daniels, a former president of the Globe, and former Time Inc. CEO Jack Griffin, in partnership with cousins Steven and Ben Taylor, whose family once owned the newspaper.
The 225,000 selling Globe was put up for sale in February with Evercore Partners managing the process, part of an effort by the NYT to focus on its flagship New York Times media brand, said Bloomberg.
The deal will include the Worcester Telegram & Gazette and a growing printing business.
The Times Co is coping with an industry-wide decline in advertising that has caused a drop in revenue and stock prices, says Bloomberg.
Under ex-BBC chief Mark Thompson, it now wants to concentrate on its NYT brand and the digital possibilities.
Its market capitalisation has fallen 19% since the Globe acquisition, to about $1.6 billion today, after reaching more than $8 billion in 1999.
Eileen Murphy, a spokeswoman for The Times Co., didn't respond to a request for comment.
There have been disagreements with bidders over what contingencies to attach to a deal, particularly whether to fold in a portion of the pension liability as part of the offers said Bloomberg, quoting sources.
The New England Media Group, which manages the Globe, has reportedly about $110 million in pension liabilities.
The unit that owns the Boston Globe had $394.7 million in sales last year, a 44% decline since 2004.
In 2011, Freedom Communications boss Aaron Kushner, publisher of the Orange County Register in California,was said to have offered offered more than $300 million - included the assumption of both qualified and unqualified pensions.
The Times according to Bloomberg. turned down the offer because it didn't include enough cash up front.