NY Times Has Few Bids for Sale of Red Sox and Globe

April 27, 2009

(ChattahBox)—The Boston Red Sox are on a winning streak, just having swept the New York Yankees in a three-game home stand. Their home games are always sold out, and rabid fans even travel in droves to away games. The Red Sox is one of the most valuable sports franchises in the country, having won two World Series in the past five years. So, why is the NY Times, owning a 17.75 minority stake in the franchise, having such a hard time finding a buyer?

The NY Times is having difficulty during a deep recession selling what many consider a “vanity asset,” that would not be recession proof during difficult times when people are losing their homes and jobs. As people are tightening their belts, entertainment, vacations and dining out expenses no longer fit in the budget. Some high-priced luxury seats of many baseball stadiums now sit empty as the season gets underway, with no sign the recession will improve any time soon.

The NY Times is hoping to make a sizeable profit from the sale of its original $75 million investment in the Red Sox. Last year the company tried to quadruple its profit, but received no suitable offers. In today’s market, the original investment would barely double at $130 million to perhaps $160 million, but even that valuation is only on paper.

Realistically analysts say, the NY Times could expect lower bids. Red Sox head owner, John Henry has the option of matching bids made to purchase the Time’s minority stake.

The NY Times is also thought to be putting out feelers to sell the Boston Globe newspaper, which lost $85 million this past year, although the paper is not for sale. The sale of the Red Sox and the Globe could possibly be packaged together. The Times recently issued an ultimatum to the Globe management, to secure a $20 million cut from the unions by May 1 or the paper may be shut down.

The severe reduction in its advertising revenue is forcing the Globe management to make significant additional cuts and layoffs. These are bad times indeed for the newspaper business.

Source


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One Response to “NY Times Has Few Bids for Sale of Red Sox and Globe”

  1. Baseball Fields » Blog Archive » Baseball Fields on April 29th, 2009 7:24 pm

    […] NY Times Has Few Bids for Sale of Red Sox and Globe – Chattahbox.com(ChattahBox) The Boston Red Sox are on a winning streak, just having swept the New York Yankees in a three-game home stand. Their home games are always sold out, and rabid fans even travel in droves to away games. The Red Sox is one of the most […]

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