No sale: Times Co. keeps Boston Globe

Posted by Jennifer Lush on October 15, 2009 at 11:53 AM

The rollercoaster ride has come to an end for The Boston Globe employees with the New York Times Company finally deciding against selling the newspaper. Yesterday it released a statement saying "that after careful consideration and analysis, it has terminated the process to explore the sale of The Boston Globe, Boston.com and related businesses and they will remain within the Company."

The move comes following a turbulent few months of bidding and even the possibility of closing the 137 year paper.

In a memo to employees, Chairman Arthur Sulzberger, Jr. and CEO Janet Robinson said finances had "significantly improved": "All along, we explicitly recognized that a careful restructuring of the Globe was one possible route and, thanks to your hard work, that is precisely what has been done.

A large part of this restructing came in April when the Globe's largest union, the Newspaper Guild, approved a package of $10 million in wage and benefit cuts after the company had threatened to close the paper if $20 million in savings could not be made. Six other smaller unions representing the paper's staff had already ratified concessions totalling $10 milion.

It has also been suggested that the decision not to sell was a result of unsatisfactory bids placed by former Globe exec Stephen Taylor and PE firm Platinum Equity. Whilst is remains unknown what the final bids actually were, in a preliminary round each suitor offered about $35 million for the Globe and the T&G, plus the assumption of $59 million in pension liabilities. The Times Co. had purchased the Globe for $1.1 billion in 1993, and the T&G for $296 million in 2000. It is quite likely that the executives decided the Globe was worth more as a part of the company, than as a sale.

Taylor, who read of the company's decision on Boston.com said : "I perfectly well understand and always have that it's the Times's perogative to make the business decision that they feel is best for them.
"I'm very grateful to my teammates and to a lot of great people in Boston who wanted to help see this project succeed, as investors or in any other capacity. But above all, I really care about the Globe and want the Globe to succeed on its own merits and in its mission to serve the community as well as possible.

Sulzberger and Robinson acknowledged the committment of employees during the period of uncertainty: "We know this has been a long and painful process, and we deeply appreciate the focus and dedication that you have all displayed over the past several months.

Reporter Marcella Bombardieri, said the decision means "things can quiet down and we can go back to doing our job."

The fortune of the Globe has not yet been extended to the Worcester Telegram & Gazette, another Times Co. entity. The company has recently been approached by a possible bidder for the paper and executives say they "are determined to reach a conclusion there quickly".

Source : paidContent, Boston.com