For Less Than 10% of the Price They Bought It At
They bought the Globe for $1.2 billion. Seems incredible now, doesn't it? They hope to unload it for $100 million.
Making the sale more difficult is the fact that the NYT is currently on the hook for $110 million in pension liabilities, which a buyer might agree to pay for, but the New York Times wants... cash.
Let me throw my mind back in time to 1993 to see what I can remember. My memory might be wrong on this point, but I believe, at the time, there was quite a lot of belief that a company's brand recognition -- the size it occupied in "mindspace," I think was the sort of buzzword used -- was more valuable than any tangible asset.
There was a belief that all of these media companies were substantially undervalued and that they would own the future -- if "mindspace" is the big thing, then the most important companies would be not only those that cast a long shadow in the public's mindspace but whose business was actually colonizing the mindspace of their programmed drones customers.
If I'm remembering right, there were a lot of big media acquisitions and mergers between, say, 1988 and 1996. I had the feeling that a lot of companies trying to get bigger for the big Keiretsu Wars coming in the near Neuromancer-like future.
Yeah. Remember all the stupid things smart people used to believe?
I don't know how all of these mergers and acquisitions worked out. I think many of the entertainment companies are still profitable, though I don't know if particular purchases (like Sony's then-huge purchase of Columbia Studios) actually wound up making money for the purchaser.
It certainly does seem that newspapers and magazines were the big losers, and most people not named Rupert Murdoch who sunk lots of money into major "mindspace" newspaper properties took a bath.