Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: SATURDAY, June 12, 1993 TAG: 9306120071
SECTION: BUSINESS PAGE: A-8 EDITION: METRO
SOURCE: Associated Press
DATELINE: NEW YORK LENGTH: Medium
The top executives of the two companies said at news conferences in Boston and New York on Friday that they hoped to lure advertisers targeting customers across the Northeast on the theory that two prestigious newspapers can jointly attract more business than they could separately.
In addition, they plan to look at ways to save money by combining purchases of materials, such as newsprint, and the companies' news and marketing data bases.
Arthur Ochs Sulzberger, chairman and chief executive of The New York Times, said the deal was a once-in a-lifetime opportunity he couldn't pass up and that the papers were a "strong strategic and cultural fit."
William O. Taylor, chairman and chief executive of the Globe's parent, Affiliated Publications Inc., said the deal "will preserve and enhance the long and proud tradition of the Globe."
The Times agreed to pay what analysts said may be the highest price ever paid for a U.S. newspaper company. Most of the $15-a-share offer for Affiliated was in new Times stock.
In reaction to the deal Friday, Wall Street sent Times Class A shares down $2.50 to $24.37 1/2. Affiliated Publications rose 37 1/2 cents a share to $13.62 1/2.
Although it will be put to a vote by shareholders of each company in September, the pact contains terms that virtually assure approval and discourage unsolicited bids.
The deal continues a trend toward consolidation of media ownership, as other media, entertainment and communications companies lay aside differences in a bid to revolutionize how people are informed and entertained.
Newspaper industry analyst John Morton said the Times was paying "a fat price, but bear in mind that Boston, when it is not in recession, is a very good newspaper market."
He said the Globe is "a very well-managed company" that has already made substantial investments in color capability and other technological enhancements. "It doesn't have to be fixed," Morton said.
The Times is the largest metropolitan newspaper in the United States, with a daily circulation of 1.2 million. The Globe has a daily circulation of 505,000, No. 12 nationally.
The Globe had rejected a near-identical offer from the Times in January. To close the deal, the Times added a five-year guarantee giving Globe executives and editors complete say over the newspaper's operation.
by CNB