Rupert Murdoch denies he's interested in the New York Times
Jul 2nd 2009 12:00PM
Updated Dec 4th 2009 5:50PM
Media mogul Rupert Murdoch is shooting down speculation that he is interested in acquiring his nemesis The New York Times Co. (NYT).
Speaking to TheStreet.com, the News Corp. (NWS) Chief Executive Rupert Murdoch denied reports by Vanity Fair's Michael Wolff that he covets what he views as the symbol of liberal mainstream media. A combination of the Times and Murdoch's Wall Street Journal has been discussed ever since the tycoon snapped up the paper's parent company, Dow Jones & Co., for $5.6 billion in 2007.
"That's nonsense. I don't think it's for sale anyway," Murdoch told the web site controlled by Jim Cramer (where I briefly worked). "I haven't even thought about it. But I would imagine that it would be legally and politically almost impossible, so I'm not thinking about it. "
Murdoch is being disingenuous. He would be foolish not to consider buying the Times. The synergies of combining the New York Times with his New York Post and Wall Street Journal are too compelling to ignore, particularly in areas such as printing and distribution. Plus, the Times would give the Australian-born billionaire the ability to shape public opinion in ways he can only dream of.
As the insane price for Dow Jones illustrates, Murdoch's lust for influence trumps his desire to make a good return for his shareholders. New York-based News Corp., also the parent of the Fox News Channel and 20th Century Fox, is down more than 47 percent over the past three years, under-performing rivals such as Walt Disney Co. (DIS), which dropped 22 percent. Time Warner Inc. (TWX), the corporate parent of this blog, has performed worse, tumbling more than 50 percent during the same period.
My hunch is that Murdoch was advised by his lawyers and bankers that buying the New York Times Co. would be more trouble than it was worth. For one thing, the Sulzberger family, which controls the company through a controversial dual-class stock ownership system, would sooner go to a NASCAR race than sell the family business to someone they detest as much as Murdoch. Even if they agreed to sell, odds are fairly good that such a deal would result in close antitrust scrutiny by the U.S. Department of Justice. Finally, many Times editors and reporters would rather eat rusty nails than work for the tycoon whose politics they detest. Many top Journal editors and reporters have left the paper for rivals, including Bloomberg News (where I used to work), since it was acquired by News Corp.
Analysts expect News Corp to report earnings per share of 19 cents versus 35 cents a year earlier in the quarter ended June 30. Revenue is expected to fall 10.8 percent to $7.66 billion as media companies suffer from soft advertising brought on by the recession.
In other words, Murdoch has bigger things to worry about right now than an acquisition of the Times.