February 21, 2013 – The Boston Herald
The worst kept secret in town — that The Boston Globe is up for sale — became official yesterday when the paper’s New York owners publicly put it back on the block in a move that set off wild speculation about who will buy the beleaguered broadsheet and what’s in store for its staff.
The proposed sale — announced in a press release by its owner, The New York Times Co., that caught the Globe’s staff off guard — marks the second time the paper has been on the market since 2009. It also comes as key managers have jumped ship in recent months, among them editor Marty Baron and boston.com general manager Lisa DeSisto.
Industry experts predict it could be a tough sell for the Times, unless it takes on the tens of millions in Globe pension obligations.
“That presents a real stumbling block. They won’t find a buyer if the debts remain,” said Kevin Kamen, a newspaper broker from New York.
Kamen, who estimated the Globe’s worth at $63 million, said the Times “won’t be able to move this” in a timely manner or “get a decent amount of cash in return” unless they absorb the pension costs.
Old suitors, as well as some new ones, are likely to come forward and test the waters, according to one observer.
“I’m sure all the previous parties will at least take a look,” said Lou Ureneck, a Boston University professor who has studied newspaper economics. “It’s an organization that is not on life support, and as a consequence, there will be an interested buyer.”
With banks no longer underwriting newspaper purchases, Rick Edmonds, a media business analyst for the Poynter Institute, said the most likely buyer this time would be “either a rich person or a group of rich people who … will put up the money to do this.”
Rick Daniels, the former Gatehouse Media New England president and Globe exec, and the private equity firm Boston Post Partners are reportedly in the mix, while James R. Houghton, the retired chairman of the board of Corning Inc., also has been floated as a potential buyer.
Stephen Taylor, whose family sold the Globe to the Times for $1.1 billion in 1993, could re-emerge as a player. Taylor was last linked to a group led by Aaron Kushner, a Wellesley businessman, who was looking to purchase the Globe two years ago and may still be interested as well.
Then there’s former Hub ad exec Jack Connors, who has been part of several groups that have sought to purchase the Globe over the past few years. Billionaire Warren Buffett, who bought more than 60 newspapers last year, could also emerge as a dark horse bidder.
Boston Mailers Union President Mary White said yesterday’s press release caught many staffers by surprise. “Every one of my members called, expressing surprise and concern,” White said. “Everyone is nervous, but why? Right now, there’s no need to be nervous. There’s so many different ways it can go. All we can do is sit and wait.”
Terrence Lomax, whose company, Think Forward Media, collaborates with the paper and works out of the Globe office, said he “saw it coming.”
“It’s not necessarily a bad move,” Lomax said. “Under new ownership they may be able to do more innovative things they’ve been wanting to do.”
The Times Co. said it retained investment firm Evercore Partners to handle the sale. Evercore managed the sale of the Philadelphia Inquirer and Philadelphia Daily News last year. An Evercore spokesman declined comment. Times Co. CEO Mark Thompson said the sale of the Globe and the Worcester Telegram & Gazette — its other major piece in its New England Media Group — is “in the best long-term interests of these properties and the employees who work for them as well as in the best interests of our shareholders.”
Jessica Heslam contributed to this report.