New York Times Company Sells Boston Globe

Jeff Bercovici – 8/3/2013
No one likes to sell in a down market. But for The New York Times Co., patience has proved awfully expensive.

The Times Co.’s sale of its New England Media Group to Boston Red Sox owner John Henry for $70 million in cash represents a loss of more than $1.3 billion on the assets, which include the Boston Globe, the Worcester Telegram and Gazette and the website And it doesn’t even get the company out from under the Globe’s hefty pension obligations; the Times agreed to keep shouldering them as part of the deal.

The Sulzberger family, which controls the Times Co., bought the Globe’s then-parent, Affiliated Publications, for an eye-popping $1.1 billion in 1993. It then tacked on the Telegram & Gazette six years later, acquiring it from Chronicle Publishing for $295 million.

The timing couldn’t have been worse, with the deals coming just before and immediately after newspapers started slipping over the precipice created as first classified ad dollars and then readers started migrating to the internet.

Still, the Globe didn’t lose all of its value at once. In 2010, when entrepreneur Aaron Kushner came calling only to be turned away by Times Co. management, a sale would likely have fetched $120 million in the view of media appraiser Kevin Kamen. By February of this year, he’d adjusted his estimate down to $63 million, just $7 million off the actual price Henry paid. (Kamen was similarly on target in guessing how much Tribune Co. would sell Newsday for; Cablevision CVC +5.2% paid $650 million for it in 2008.)

Even as recently as February, the Times Co. had an offer on the table worth more than $100 million from former Globe president Rick Daniels and Boston Post Partners. Such a sale would have rid the Times of the pension liabilities and also satisfied the goal of returning the Globe to local ownership.

In the end, getting value for the Massachusetts assets was less important than the larger strategic goal of reorienting the Times Co. around a single global brand. The Globe was the last thing standing in the way of that. With the distractions dealt with once and for all, it’s time to see if publisher Arthur Sulzberger and CEO Mark Thompson truly have a vision for bringing The New York Times back to growth.