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Stephen Taylor’s group has bid $35 million for the Globe. |
Two bidders visit Globe; third group may drop out
Two potential buyers of The Boston Globe visited the newspaper in the past five days - one a group headed by Stephen Taylor, whose family used to own the paper, and the second, Platinum Equity of Beverly Hills, Calif., a private equity investment firm, according to several people involved in the meetings.
Another local group does not have a visit scheduled and could drop out of the bidding, according to people involved in the process. That group is led by former advertising executive Jack Connors and Boston Celtics co-owner Stephen Pagliuca, who is considering a bid for Edward M. Kennedy’s US Senate seat.
Taylor and Platinum offered to pay about $35 million for the Globe and Worcester Telegram & Gazette, both of which are owned by The New York Times Co. They would also assume $59 million in pension liabilities for the papers.
Pagliuca and Connors submitted the lowest bid. It called for a future payout to the Times Co., according to people involved in the talks. They also proposed creating a nonprofit foundation that would have a stake in the paper.
In meetings with Globe employees last week, Times Co. executives said some bidders were further behind in the process than others - apparently a reference to Pagliuca and Connors. The Times Co. declined to comment yesterday.
If Pagliuca runs for the Senate, he would not pursue the Globe because it would be a conflict of interest. Before his political aspirations were made known, Pagliuca had been open to joining forces with Taylor, who is raising money for his bid, said people involved in the bidding.
Taylor’s team yesterday held all-day meetings with management at the paper, according to three people who were present. On Thursday, Platinum representatives held similar meetings. Both sessions were arranged by Goldman Sachs & Co., the investment bank the Times Co. hired to solicit bids.
A Goldman Sachs banker involved in the negotiations did not return a call yesterday seeking comment. Platinum also did not respond to requests for comment.
Taylor, a great-great grandson of the Globe’s founder, worked for the paper for nearly two decades. He was an executive vice president when the family sold the newspaper to the Times Co. for $1.1 billion in 1993. His management group features a number of former Globe executives, including William Huff, a former chief financial officer of the Globe and its president from 1997 to 2001; and a former controller, William Connolly. Robert Murphy, the Globe’s former technology chief, also is part of the team, as is Richard Gair, who was general manager of Boston.com from 2005 through last year.
In addition, the group includes Mary McGrath, cofounder of Open Source Media Inc., an online radio firm, and the original producer of “The Connection’’ talk program on WBUR radio.
Platinum, which earlier this year bought the San Diego Union-Tribune, brought a contingent to the Globe that included partner Louis Samson and David Black, who owns many newspapers, from the Akron Beacon Journal in Ohio to the Honolulu Star-Bulletin to more than 100 community papers in Canada. Black is consulting to Platinum on its San Diego investment.
Final bids for the Globe could be submitted by the end of September. Goldman Sachs has stipulated the bidders cannot speak to one another before that time.
Times Co. executives have said the Globe is on much firmer financial footing than it was several months ago, after raising prices for the paper, gaining $20 million in wage and benefit concessions from the newspaper’s unions, making cuts in management compensation, and saving $18 million by closing the company’s Billerica printing plant.
“Our hand is no longer being forced,’’ in terms of selling the paper, chairman Arthur O. Sulzberger Jr. told employees during a meeting at the Globe last week.
Yesterday, in an upbeat companywide e-mail, Sulzberger and Times Co. chief executive Janet Robinson said revenues have been bolstered by readers’ willingness to pay more for the Globe and the Times. They wrote that “there have been far fewer cancellations from price increases than we expected at both The Times and the Globe,’’ and called reader retention rates for both papers “enviable’’ - about 90 percent for people who had subscribed for at least two years.
Tomorrow, the Taylor group is scheduled to visit the Telegram & Gazette and printing facilities. Platinum visited Worcester and the other locations Friday.
Michael Rezendes of the Globe staff contributed to this report. Beth Healy can be reached at bhealy@globe.com. 
© Copyright 2009 Globe Newspaper Company.
