The New York Times Co. said yesterday that it will not sell The Boston Globe, citing significant improvement in the Globe’s financial standing - a decision that ends months of uncertainty about the future of New England’s largest newspaper.
The Times Co. had been exploring a sale of the Globe and its website, Boston.com, along with the Worcester Telegram & Gazette since at least the spring; final bids were due Friday. Two potential buyers submitted offers, but in a memo to employees late yesterday, the company’s top executives said they had ended their consideration of a Globe sale, and looked forward “to charting our future together.’’ The company did not rule out a sale of the Worcester paper.
“We know this has been a long and painful process,’’ Times Co. chairman Arthur O. Sulzberger Jr. and chief executive Janet Robinson said in their memo, adding that they had come to their decision “after careful consideration and analysis.’’
The announcement followed a meeting of the Times Co. board of directors, some of whom had been pressing for a sale of any assets unrelated to The New York Times news operation. And the decision appeared be a relief to many people inside the Globe, six months after the Times Co. had threatened to shut down the 137-year-old paper unless its unions made dramatic concessions on wages and benefits.
The Times Co. has “gone from threatening to close the paper, to an effort to sell the paper, to a very speedy rejection of some bids,’’ said Stephen Burgard, director of the School of Journalism at Northeastern University. He said the bids likely were “not sufficient to entice the Times to go forward with a sale.’’
Preliminary bids for the Globe and the T&G were for about $35 million, plus the assumption of $59 million in unfunded pension liabilities. The Times Co. had purchased the Globe for $1.1 billion in 1993, and the T&G for $296 million in 2000.
The bids were submitted by two groups - one led by Stephen Taylor, a former Globe executive and a member of the family that sold the paper to the Times Co.; and one by Platinum Equity, an investment firm in Beverly Hills, Calif., that earlier this year purchased the San Diego Union-Tribune. It could not be learned what their final bids were.
Taylor last night said he had learned of the Times Co.’s decision the same way many people in town had - on the Globe’s website. “It’s a credit to Boston.com,’’ he said of the site he helped launch in 1995.
A great-great-grandson of the newspaper’s founder, Taylor said he was grateful to his partners in the bid, and the investors who had pledged their support. “But above all, I really care about the Globe and want the Globe to succeed on its own merits, and in its mission to serve the community,’’ Taylor said.
He also said, “It’s the Times’s prerogative to make the business decision that they feel is best for them.’’
A spokesman for Platinum Equity declined to comment.
Media industry observers said they weren’t entirely surprised the Times Co. took the Globe off the market. Recently the Times Co. had said it might not sell the Globe because the paper’s finances were improving.
“I have thought from the get-go that selling right now didn’t make sense, especially after they’ve done a fairly substantial part of the job of getting the cost basis in line,’’ said Rick Edmonds, a media analyst at the Poynter Institute in St. Petersburg, Fla.
Earlier this year, Times Co. executives had said the Globe was on course to lose $85 million in 2009, as the slow economy pummeled advertising revenue and as more readers and advertisers migrated to the Internet.
Ultimately, the company received $20 million in concessions from the Globe’s unions, after wrenching negotiations. Globe managers took pay cuts as well, and the paper made a successful gamble on raising subscription prices amid a recession. The company also cut $18 million in costs by shutting down a Billerica printing plant and consolidating production at its Boston facility.
The Times Co. memo suggested that not selling had always been an option: “All along, we explicitly recognized that a careful restructuring of the Globe was one possible route.’’ Robinson is planning to meet with employees at the Globe this morning.
The New York Times, citing people briefed on the matter, reported Platinum lost confidence that it could meet the Times Co.’s terms. They also said that Times Co. executives would have preferred to sell to Taylor’s group, but had raised questions about its financing.
Edmonds and others said the Times Co. could still decide to sell the Globe, depending on how it manages through the transition of readers and advertisers to the Internet. “Waiting for better times, even if they really do want to sell it, made a certain amount of sense,’’ Edmonds said.
But for now the announcement eliminates some of the uncertainty Globe employees have faced in recent months.
“I have to admit I’m relieved that the speculation is over,’’ said Mary White, president of Teamsters Local 1, which represents more than 200 mailers. “We know who we’re dealing with, and I don’t think that’s a bad thing.’’
Martin Callaghan, president of the Boston Newspaper Printing Pressmen’s Union, said: “I can’t say I’ve been totally disgruntled with them as owners.’’ He added, “Hopefully, the Globe will continue to improve and we can go and negotiate a wage increase.’’
As for the fate of the Worcester paper, Sulzberger and Robinson said in their memo they are assessing “strategic alternatives’’ for the T&G and they “are determined to reach a conclusion there quickly.’’
A group of local businessmen submitted a bid to buy just the T&G, according to the paper. The team is led by Ralph D. Crowley Jr., chief executive of Polar Beverages Co., and Harry T. Whitin, a former T&G editor. Details of the bid were unknown.
Some analysts, including Edmonds of Poynter, have suggested that the Times Co. could reap a significant tax benefit by selling the T&G - in the form of a write-off of nearly $300 million. That capital loss could offset other gains the Times Co. has made this year, as it sold off media properties and as it looks to sell its 17.5 percent stake in the Boston Red Sox.
The T&G’s publisher declined to comment.
Under any owner, the pressures that all newspapers face continue to present challenges for the Globe going forward. Burgard, of Northeastern, said he thinks the Globe, despite the recent turmoil, is positioned to succeed in the new media environment.
“The paper itself has been the agenda-setter in the region,’’ Burgard said. “If any major metropolitan paper is situated to adapt to the new environment, the Globe is.’’
Beth Healy can be reached at bhealy@globe.com. Megan Woolhouse and Robert Gavin of the Globe staff contributed to this report. 
