Conflict of Interest? New York Times Sells Holdings of Boston Red Socks
First of all, who knew that the New York Times (NYSE:NYT) was a minority shareholder in the Boston Red Socks? Not I. Today The New York Times Company reported in 8-k filings that it sold $117 million worth of shares in Fenway Sports Group, a holding company that owns sports franchises Liverpool Football Club and the Boston Red Sox, and their respective home arenas Anfield Stadium and Fenway Park. The Times will likely use proceeds from the sale to whittle away at over $1 billion in outstanding debt on its balance sheets. NYT sold 390 of its 700 class B shares in FSG to three separate buyers that were not named in the company’s filings. Shedding some light on the paper’s possible motives for owning shares of FSG, the Times also owns leading Boston newspaper “The Boston Globe” and its parent company New England Media Group. Here’s Why the New York Times is Stupid>>
WSJ reports that the Times has been trying to sell its Red Sox shares since 2008 (the year after they won the World Series…?) but had difficulty finding buyers until recently. Russell Adams notes that weakness in print newspaper revenues has been particularly apparent lately: “In recent months, newspaper companies including Times Co. have posted results that show persistent weakness in print advertising, which accounts for nearly 80% of Times Co.’s total revenue. In the most recent quarter, ad revenue at Times Co.’s newspaper properties, which include the New York Times (NYSE:NYT) and the Boston Globe, declined 7.5% compared with a year ago. The company reported a 58% decline in profit for the period.” That also might be an explanation for why the NYTimes.com website recently put a cap on the number of articles a person can view for free each month.
NYT (NYSE:NYT) stock finished the day down 0.11%, and has not fared well in 2011, down 11.12% in the first six months of the year.
Competitors to Watch: Gannett Co., Inc. (NYSE:GCI), Lee Enterprises, Inc. (NYSE:LEE), A.H. Belo Corporation (NYSE:AHC), Media General, Inc. (NYSE:MEG), McClatchy (NYSE:MNI), The E.W. Scripps Company (NYSE:SSP), Daily Journal Corporation (NASDAQ:DJCO), AOL (NYSE:AOL), Interactive Corp (NASDAQ:IACI), Apple (NASDAQ:AAPL), McGraw-Hill (NYSE:MHP), Pearson (NYSE:PSO), Washington Post (NYSE:WPO) and News Corporation (NASDAQ:NWSA).
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