MediaFile

Murdoch wants newspapers, just not The New York Times

Robert MacMillan

Feb 5, 2009 19:58 EST

Michael Wolff, author of the recently published Rupert Murdoch tell-all, “The Man Who Owns the News,” says that the News Corp chief executive would love to buy The New York Times. The only thing standing in his way is the Ochs-Sulzberger family which controls the Times. If they’re anything like the Bancrofts, former controllers of Dow Jones/Wall Street Journal, only an insane amount of money might persuade them to let go of the prized but struggling newspaper publisher.

Or maybe Murdoch himself. Whatever the scuttlebutt is about Murdoch’s plans for the Times, he told reporters on Thursday that he’s not interested in buying it. Speaking on a conference call after the company reported dismal second-quarter results, he said it might not be good for his image:

“I’ve got no desire to be an even bigger public enemy.”

This, of course, refers to the charge leveled at him from London to New York to Hong Kong that he uses the papers and other media that he owns to advance his personal business interests.

As for newspapers themselves? He already owns a bunch, from the Journal (which was part of a $3 billion-plus writedown on Thursday’s earnings) to the New York Post ($185 million writedown Thursday) to The Times of London to The Australian. And he’s keeping them, by the sound of things:

“I’ve got great faith. If we continue the way we’re going, we may even get lucky and not have so much competition at the end of it all.”

There he goes again — trashing The New York Times. But look at it this way, why not trash it until it’s beaten down enough that the Sulzbergers are compelled to sell? After all, Murdoch only has to be right today. He can change his mind tomorrow.

Could Slim be a bad harbinger for New York Times dissidents?

Robert MacMillan

Jan 19, 2009 18:34 EST

Mexican billionaire and telecommunications tycoon Carlos Slim is poised to throw hundreds of millions of dollars at The New York Times Co so the newspaper publisher can buy some more time to get its act together as advertising revenue falls and debt looms. If he is truly an ally of the Times, as our sources say, it could prove bad news for dissident investors like Harbinger Capital Partners who are pressing for drastic changes at the Times.

The Wall Street Journal broke the story on Saturday night, closely followed by Reuters. It was The New York Times itself (surprise!) that reported the specifics of Slim’s “bailout package” for the Times:

• A $250 million investment in exchange for 10-year notes with warrants that are convertible into common shares.
• A special annual dividend would go to Slim — maybe 10 percent or more of his investment.
• No voting rights, no board seat.
• With his 6.4 percent stake in the Times’s common shares, this could make him the largest Times shareholder, bigger even than the Ochs-Sulzberger family that has controlled the times since 1896.

The value of Slim’s previous investment already has fallen, but if he is treating the Times more as a philanthropic exercise than a business decision, this could work out well for both parties.

Here’s what Slim would get: A burnished reputation. The 68-year-old Slim has been trying to remake his image in recent years from that of a robber baron who cornered the Mexican telecommunications market, shut out competition and got tacit (if not explicit) government support for it.

The world’s second-richest man, Slim also has been donating millions to charity. Helping a liberal-voiced, family-run newspaper empire in distress — one of the world’s most famous, independent newspapers, we hasten to add — without interfering in its strategic direction or editorial focus is a nice way to get people to respect you.

Here’s what the Times would get: Time to figure out how to right itself financially. As I wrote in an analysis on Sunday, the Times has a big to-do list, including possibly selling its Red Sox stake, The Boston Globe and pursuing other moves.

Crunching the New York Times numbers

Robert MacMillan

Nov 21, 2008 14:59 EST

The New York Times Co’s announcement on Thursday that it’s cutting its dividend by almost 75 percent is a pretty grim indicator of the fortunes of the storied newspaper publisher. It also is fraught with implications. It prompted us to put some of the numbers in perspective, but first, here’s a recap of the news:

NEW YORK (Reuters) – The New York Times Co slashed its dividend by almost three-quarters and plans to cut spending and reevaluate its assets to cope with an advertising decline that is gouging U.S. newspaper publishers.

The trustees of the Ochs-Sulzberger family’s shares in the Times said on Thursday they support the company’s actions.

“The trustees remain unanimous in their commitment to the editorial integrity and independence of the New York Times,” they wrote in a statement.

This is significant because industry watchers and media experts say the family is under more pressure than ever before to sell parts or all of the company.

Here are some ways of defining “pressure:”

• The company is worth $725 million. When it bought The Boston Globe in 1993 it paid about $1 billion.
• Its publicly traded shares were worth $49 two years ago.
• The ratio of the share price to the cover price of the Sunday edition of the Times is under 2:1.
• The ratio of the share price to the daily cover price is under 5:1.