NYT Somehow About to Make $100 Million Selling Red Sox
In 2002 The New York Times Company acquired a 17.5 percent stake in New England Sports Ventures (NESV), which owns the Boston Red Sox, cramped and splintery Fenway Park, and a controlling interest in the cable network that airs the team's games. (They also just bought Liverpool F.C.)
The pairing of The Gray Lady and the not-yet-beloved Red Sox raised a few eyebrows--even in 2002, the general consensus was that a print newspaper with $75 million to invest would have been better served throwing the money--literally throwing it--at the first programmer, TED panelist, or bronchial hobo who said he had an idea for making money off the Web. According to a Wall Street Journal report, The Times Company (which also owns The Boston Globe) saw the investment as a chance "to shore up the Globe's advertising position in New England by packaging the Globe with New England Sports Network, one of the most powerful television outlets in the region." But the strategy didn't work, and the Globe's circulation numbers continued to shrink.
Due to the sluggish economy, struggles at the Globe, and the public's uneasiness with the mental image of a stack of newspapers shaping the future of their favorite team (a scene that isn't far off, considering the company's shares are non-voting), New York Times CEO Janet Robinson's announcement today at the Reuters Global Media Summit that the company is looking to sell its stake in NESV seems like an exercise in cutting ones losses. But this is not the case. The New York Times is just really, really good at running professional baseball teams, and they're ready to cash out. Ben Klayman of Reuters crunched the numbers both on-and-off the field:
"The Times paid an estimated $75 million for a 17.75 percent stake in 2002, before the Sox won two World Series titles, and analysts and bankers have previously said the company was seeking as much as $100 million for its entire stake. It was the second largest stake in NESV, behind owner and hedge fund manager John Henry...However, the Times, which has been working to cut its debt, has seen its potential return damaged since the economic downturn. Prior to that, speculation had swirled that it could fetch $200 million or more for the stake."
And some days it rains.