Boston Globe for Sale!
The deadline is past and the bids have been submitted to the New York Times Co.
The deadline is past and the bids have been submitted in the game of Who Wants to Own a Boston Globe … and the Rest of the New England Media Group Properties Including the Worcester Telegram & Gazette, Too. (Dare you to say that five times fast, Philbin.) According to the Globe’s own reporting, the New York Times Co. received at least five bids for the paper before the 5 p.m. Thursday deadline. They are:
- Red Sox owner John Henry and his Fenway Sports Group
- Former Time Inc. chief Jack Griffin and two members of the Taylor family, who sold the paper to the New York Times Co. in the first place.
- Former Globe president Rick Daniels and partner Heb Ryan, a Boston private equity executive.
- Tampa Tribune Owner Robert Loring, founder of Revolution Capital Group in Los Angeles
- John J. Gormally Jr., the owner of TV stations and BusinessWest Magazine
- Shannon Liss-Riordan, a Boston lawyer who worked on a bid with Thomas W. Janes of Kerry Capital Advisors, a Boston private equity firm.
Bids are expected to be somewhere in the range of $100 million, a sad fraction of the $1.1 billion the New York Times Co. paid for the paper 20 years ago, and a figure that pretty tidily tells the tale of the newspaper industry in the intervening decades.
Bloomberg’s Edmund Lee explains why selling a newspaper isn’t quite as simple as handing over the keys to a car. Bidders have apparently argued with the Globe over how much cash to pay up front and how much of the Times Co.’s $110 million in pension liabilities they will take on. Lee writes:
Imagine an offer going like this: $30 million in cash upfront, and we assume 70 percent of the pension.
The potential problem with that kind of offer is that if the new company isn’t able to fund the pension somewhere down the line, it reverts back to the Times, meaning they’ll continue to have to foot the bill. That’s why the Times would rather have more cash up front — ideally $110 million — so it can wipe away the Globe’s pension liability.
The New York Times Co. also provides the Globe with corporate services like payroll and human resources, so any new owner will have to figure out how to replace those.
Despite those complications, MassLive.com spoke to people who seem to think the New York Times Co. backing out of a sale like they did in 2009 is unlikely because its value is only going to decline further.
As for whether all this is good or bad news for the Globe and the community it serves … well, it’s certainly preferable to the New York Times Co. just closing up shop with no buyers in sight. But by most accounts, the New York Times Co. did a good job running the Globe. That leaves room for error. As the paper’s State House bureau chief Frank Phillips told this magazine several months ago, “The Times Company is a real news organization. They knew how to run a paper, and they left us alone … Just the idea of somebody coming along—a billionaire wanting to have a toy, and thinking this is going to gain him respectability and some influence in Boston—it could be ruinous.” Let’s hope not.
Source URL: http://www.bostonmagazine.com/news/blog/2013/06/28/boston-globe-for-sale-2/