New York Times Sells Boston Globe for 93% Loss
August 3, 2013 - 3:39 pm
In 1993, the New York Times purchased the Boston Globe for $1.1 billion. Today, the Times sold the Globe to Boston Red Sox owner John W. Henry for $70 million. That’s a 93% loss — not factoring in inflation.
How the mighty have fallen:
In addition to The Globe, the sale includes BostonGlobe.com; Boston.com; the direct-mail marketing company Globe Direct; the company’s 49 percent interest in Metro Boston, a free daily paper; Telegram.com and The Worcester Telegram & Gazette. The Times bought the Telegram & Gazette for $295 million in 1999.
Mr. Henry is buying the media group without partners through his acquisition company; under terms of the sale, he does not have to assume The Globe’s pension liabilities.The all-cash sale is expected to close in 30 to 60 days.
The Globe is not the only paper to sell at a heavily discounted price. In April 2012, Philadelphia’s newspapers sold for $55 million after selling for $515 million in 2006. In October, The Tampa Tribune sold for $9.5 million. In recent talks on the sale of the Tribune Company’s portfolio of newspapers, analysts estimated that the entire newspaper company, including The Los Angeles Times and The Chicago Tribune, was worth only $623 million.
For the Times Company, the New England Media Group was the last big asset in a portfolio it had been downsizing for several years. The acquisition of The Globe in 1993 was part of the company’s strategy to solidify its grip on the eastern corridor advertising sector and to have a presence that stretched from Maine to the District of Columbia. At the time, in addition to its flagship New York newspaper, the Times Company owned 31 regional newspapers, 20 magazines, five television stations, two radio stations and other businesses. It also had a half-interest, with the Washington Post Company, in The International Herald Tribune.
But in recent years, the Times Company has been divesting itself of assets to focus on developing its core title, The New York Times. In 2012, the company sold its 16 regional newspapers. Last year, it sold the About Group to IAC/InterActiveCorp for $300 million. This year, The Times announced plans to expand its global presence by changing the name of The International Herald Tribune to The International New York Times and attracting a new global audience of readers to become subscribers.
I realize that any opportunity to stick it to the New York Times should not go awasting. But watching the death of the daily newspaper in America is painful. When their history is written, it will reveal an industry and an institution that played a vital role in America’s growth and in knitting communities together. There was also the disseminating of information, the for good or ill, led to an informed electorate. It’s hard to imagine an America without the daily newspapers that fought tooth and nail for readership and where reporters would sell their mother to scoop a rival.
In the old days, everyone knew the bias of a particular newspaper. The publisher’s political leanings were well known so if you read a news story, you were prepared to view the information through a particular prism. But in many big city papers, there were also long, fact filled think pieces — deep analysis of a particular social problem or foreign policy crisis. Those were the days.
They are all bleeding cash now. Only rich investors with a sense of community appear willing to lose millions of dollars in order to keep the presses running. The unions are mostly broken, having no leverage to speak of. And it is very old fashioned to actually buy a newspaper at a newstand — if any exist anymore.
For some, the death of the Times and Globe — whenever it occurs — won’t come soon enough. I understand the impulse but regret the reality. The world will be a poorer place without them.