New York Times media columnist David Carr this weekend asked several media pundits what they thought the newspaper publisher could get for The Boston Globe. The results were extraordinarily depressing, especially considering that the paper sold for more than $1 billion in the early 1990s.
Here is a sampling of their of their views:
Reed Phillips, a partner at DeSilva and Phillips, valued New England's largest paper at "the high end, not more than $50 million and, at the low end, a requirement to help fund the buyer's acquisition with as much as $25 million contributed by The New York Times (yes, you read that right!)."
"There can be a gap between what a party is willing to pay for assets and what they are actually worth, but we'd be surprised if a bidder stepped in ultimately paid more than $10-20 million for the Globe," said Mike Simonton, analyst Fitch Ratings.
"Add everything up – physical assets, brand name, influence – and I'll venture my SWAG estimate (Sophisticated Wild-Assed Guess) on value as being somewhere between $200 and $300 million, and if pressed for a single number I'd say $250 million," said independent analyst John Morton.
A long way of saying that while the business has value, perhaps $350-400 million, it may not have sufficient value for the Times to realize any cash from a buyer," said Mike Edmiston, AdMedia partners.
As I've argued before, the Globe has weighed-down the earnings of the New York-based publisher for years. The paper, though, is one of the best in the country. In 2003, it won the Pulitzer Prize for its coverage of the sex abuse scandals at the Catholic Church. Four years later, the Globe again won journalism's highest award for uncovering President Bush's use of signings statements which basically allowed the government to ignore all or parts of laws passed by the Congress,
None of that seemed to do much good for the paper's bottom line. The Globe is expected to lose $85 million this year, which is why the paper wanted wage concessions from the Boston Newspaper Guild.
Members narrowly rejected a $10 million package of wage and benefit concessions and the elimination of some lifetime job guarantees for Guild employees. Times Co. management is now planning a 23 percent wage reductions.
Guild members told the Boston Globe that they plan to make "an offer of resolution" of their differences in meetings today with management. Whether it's too little too late remains to be seen.
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