The New York Times Co, in its latest move to shed assets and focus more on its core brand, has agreed to sell the Boston Globe and its other New England media properties to John Henry, principal owner of the Boston Red Sox.
The sale, for US$70 million, would return the paper to local ownership after two decades in which it struggled to stem the decline in circulation and revenue. The price would represent a staggering drop in value for the Globe, which the Times bought in 1993 for US$1.1 billion, among the highest prices paid for a US newspaper.
At the time, the Globe was one of the nation’s most prestigious papers in a far more robust newspaper environment, but like other newspapers, it began to lose readers and advertisers to the Internet, and revenue plummeted. The Times Co has taken several write-downs related to the New England Media Group, and in February it said it was putting the Globe and other assets in the group up for sale.
For the Globe, the planned sale restores a Boston connection that prevailed for 120 years under the Taylor family, which owned the paper from 1873 until its sale 20 years ago. While not from Boston, Henry has for the last decade been active in local sports, and his Fenway Sports Group owns the Red Sox, Fenway Park and 80 percent of the New England Sports Network. It also owns soccer club Liverpool in the English Premier League.
“This is a thriving, dynamic region that needs a strong, sustainable Boston Globe playing an integral role in the community’s long-term future,” Henry said in a statement about the sale. “In coming days there will be announcements concerning those joining me in this community commitment and effort.”
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 US$295 million in 1999.
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.
For the Times Co, 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 Washington. At the time, in addition to its flagship New York newspaper, the Times Co 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 Co, in the International Herald Tribune.
However, in recent years the Times Co has been divesting itself of assets to focus on developing its core title, the New York Times.
Last year, it sold its 16 regional newspapers. It also sold the About Group to IAC/InterActiveCorp.