NYT facing share shakeup?
Wall Street wants to dance with the Gray Lady. But is the lady interested?Last week, the paper lurched to the center of the stage when Maurice “Hank” Greenberg, the billionaire former head of AIG, bought enough shares of the New York Times to prompt whispers of a takeover bid. Greenberg predictably played down the talk, saying he bought only 100,000 shares and wasn’t interested in making a play. But it’s a sign of how much investors are looking for ownership changes at the paper that the stock rose as much as 9% on the news. The Times has a dual-share structure that allows for nearly 90% of the company’s voting stock to be controlled by the Ochs-Sulzberger family. That makes it practically immune to takeovers — and has prompted some analysts to call for changes to a system that they argue limits accountability. Morgan Stanley chose not to vote for any of the 13 directors at the company’s board meeting earlier this year, nine of which are currently considered supporters of the Ochs-Sulzberger family. The Times has remained adamant that it will not entertain offers. Or has it? A day after the Greenberg news, a report circulated that chairman Arthur Sulzberger had a conversation with Quadrangle Group chief Steven Rattner feeling out the possibility of a private-equity group buying the paper. Conventional wisdom maintains that the company can, at least technically, maintain the dual-share system no matter how many critics surface. But recent mediocre earnings, the decline of print advertising and the possibility of bond groups lowering their credit ratings for the Times — one already has — may change its thinking. There are already murmurs of a sale of the Boston Globe, which is not protected under the dual-stock system. And the company’s fastidious concern with the Times’ image in journalism circles could make traditional newspaper company alternatives — i.e., newsroom layoffs — unpalatable. The Times may not want to dance, but it may get pulled onto the floor just the same.