Calif. buyout firm in bidding for Globe
San Diego paper’s owner is 3d suitor, with a $35m offer
An investment firm that recently purchased a San Diego newspaper has emerged as a third bidder for The Boston Globe, according to people briefed on offers submitted to the paper’s owner, The
Platinum Equity, of Beverly Hills, Calif., which bought the San Diego Union-Tribune newspaper in May, made an offer to the Times Co. last week, the sources said.
That puts Platinum in competition with two groups of Boston bidders. One of the local groups is led by Stephen Pagliuca, co-owner of the Boston Celtics and a private equity executive at Bain Capital, and former advertising executive Jack Connors. The other is led by Stephen E. Taylor, a member of the family that sold the Globe to the Times Co. in 1993 for $1.1 billion. All three bids appeared to have included the entire New England Media Group, which includes the Globe, the Worcester Telegram & Gazette, and their websites.
Platinum’s offer is $35 million, plus the assumption of $59 million in pension liabilities, something the Times Co. asked all potential buyers to include in their bids, the people said. They declined to be named because they are not authorized to speak publicly about the offers.
Taylor’s bid is believed to be in a similar range, according to the sources. Pagliuca and Connors, who are proposing a model with a nonprofit component, are believed to have offered significantly less.
A principal at Platinum, Mark Barnhill, said, “We just don’t talk about prospective deals.’’ The other bidders also declined to comment.
The Times Co. yesterday for the first time, in a regulatory filing with the Securities and Exchange Commission, acknowledged publicly that it is considering a sale of New England Media Group. The company said it had hired
The SEC filing also said the Globe and the T&G have been hurt by the forces pummeling traditional media companies, including the migration of readers and advertisers to the Internet and a deep recession. But the papers have also put in place strategic financial turnaround plans. The Globe, for instance, has shuttered its Billerica printing plant, raised subscription prices, and reduced costs, including getting $20 million in union concessions.
In an interview with the Globe this week, Times Co. publisher and chairman Arthur O. Sulzberger Jr. said the company was “exploring’’ a sale of the Globe, but doing so “does not mean that will absolutely be the case.’’
“What’s important here is that the Globe be maintained as a viable business entity, whether it’s sold or we continue to operate it, and make sure that it has the financial stability to ensure its continuity,’’ he said. “We’re committed to that.’’
It is unclear how low a bid the Times Co. is willing to accept. While the Globe delivered hundreds of millions of dollars in profits to the Times Co. over many years, it has recently been a drag on earnings. All of the bids appear to be modest, coming at the bottom of a recession and amid deep questions about the future of the news business.
Sulzberger said price “is not the only consideration’’ in the bidding, and that Times Co. management is sensitive to “the impact of a potential sale on the community.’’
Sulzberger and Robinson declined to comment on specifics of the pending bids. At least one of the groups is expected to meet with Times Co. management in New York next week.
Platinum, run by billionaire Tom Gores, is best known for buying distressed businesses, largely in technology. The firm recently bid unsuccessfully on Delphi Corp., the bankrupt Troy, Mich., auto parts maker.
Three days after buying the Union-
The Pagliuca-Connors team pitched a model that would rely on a nonprofit foundation to support the Globe’s journalism and probably would offer the Times Co. the smallest immediate financial gain. Taylor brings a history with the Globe and an insider’s understanding of the newspaper business.
The Globe’s publisher, P. Steven Ainsley, said in an e-mail to Globe employees yesterday that, “We are staying true to our mission and can’t allow any potential change in ownership to distract us.’’
He also said the Globe’s financial position was improving from earlier projections of an $85 million loss this year.
In a separate development in the news industry yesterday, Cox Media Group said it was taking the Austin American-Statesman off the market, after receiving bids it considered to be too low, according to published reports.
Asked what the odds are that the Times Co. won’t sell the Globe, chief executive Janet Robinson told the Globe: “That’s a hard one. I don’t think we can handicap anything like that.’’
Robert Gavin of the Globe staff contributed to this report. Beth Healy can be reached at bhealy@globe.com. 
