Tag: Boston Globe

Show us the money

Will the Taylor group really be able to pull off a deal to buy back the Boston Globe from the New York Times Co.? Today’s Globe piece on Stephen Taylor’s quest to acquire the paper his family sold in 1993 reports that he’s having some trouble scaring up enough money. Beth Healy writes:

Some wealthy Bostonians spurned Taylor’s early overtures, wary of investing in what they consider a dying industry, according to people involved in the bid. With final offers due tomorrow, Taylor is still scurrying to raise money. He has to convince investors he has what it takes to make it in a radically shifting newspaper landscape, despite having been out of the business for nearly a decade.

That fits with information I reported two weeks ago, when I wrote that the Taylor group was still trying to line up investors.

Meanwhile, the Boston Herald’s Jessica Heslam reports that the price of purchasing the Globe and the Worcester Telegram & Gazette may have risen substantially. Both Taylor and Platinum Equity, the only other serious bidder, have reportedly offered to pay $35 million and to assume $59 million in pension liabilities. Now, though, Heslam quotes anonymous “insiders” who say that the esimate of pension liabilities has nearly doubled, to $115 million.

Hard to tell what’s going on here. Heslam quotes a Times Co. spokeswoman who says something that sounds vaguely like a denial, but not really. So, for the moment, let’s proceed under the assumption that Heslam’s sources are right. Will this kill the deal? Especially with the under-capitalized Taylor bid?

It’s possible that the Times Co. will be forced to eat some of that $115 million, like Theo Epstein getting rid of another overpaid, under-performing shortstop. Even though the Globe carefully notes that it’s “conceivable the Times Co. won’t sell the paper,” Poynter Institute media analyst Rick Edmonds recently noted that the Times Co. would lose substantial tax advantages if it doesn’t sell by the end of 2009.

It will be fascinating to see what gets announced tomorrow. That is, if there’s an announcement.

Stayin’ alive with Platinum Equity

Tom Gores
Tom Gores

One can only imagine the glee that folks at the Boston Globe must have felt when they came across a photo of prospective owner Tom Gores looking like he’s starring in the community-theater remake of “Saturday Night Fever.” The photo leads a long piece on Gores’ tenure at the San Diego Union-Tribune.

Wearing a flamboyantly pinstriped black suit jacket over a black shirt strategically unbuttoned to show off his smooth chest (and don’t miss the black-and-white polka-dot handerchief), Gores comes across as an exceedingly unlikely candidate to stabilize the Globe’s finances while preserving its journalism. The story dwells in some detail on embarrassing facts about Gores’ personal life as well.

I should note that the photo is credited to Gores’ firm, Platinum Equity. So he must be quite proud of it.

Still, you never know. Platinum is one of two groups in the running to purchase the Globe and the Worcester Telegram & Gazette from the New York Times Co. The other, favored by most people I talk with, is headed by former Globe executive Stephen Taylor and former Globe publisher Ben Taylor, prominent members of the family that sold the paper to the Times Co. in 1993.

Platinum Equity has been the subject of fascination since it acquired the Union-Tribune earlier this year. But as the Globe story notes, though the paper’s staff has been slashed to ribbons, the Union-Tribune is now on track to turn a small profit this year. Quality matters; but nothing is possible at a paper that keeps bleeding cash.

The non-profit news site Voices of San Diego, which has been keeping a watchful eye on Platinum, recently ran a piece containing what might be described as cautious praise. The story quotes an anonymous staff member following a meeting with management: “I went into the meeting not super-receptive, given that this is the management team that had laid off more than 100 people the day before. I came out feeling better about the future of the paper than I have in two years.” The story continues:

Two other newsroom workers agreed with that assessment, and all three said they were hopeful and impressed by the new management’s willingness to criticize the old regime. (The staff members requested anonymity for fear of antagonizing the new bosses.)

The positive feelings are remarkable considering how the U-T has been plagued by poor morale and severe financial troubles in recent years. The paper has physically shrunk by about half since 2006, and several rounds of layoffs and buyouts have eliminated about half of all jobs companywide.

To be sure, there is a lot of low-hanging fruit at the Union-Tribune. Employees still paste up pages manually, a labor-intensive practice that is now being eliminated. But for the Union-Tribune to achieve financial stability so quickly, and for management now to be talking about growth, is an impressive achievement given the dire straits in which the newspaper business finds itself.

Still, I’d certainly feel better if the Taylor group prevails. Yes, the Globe has to succeed as a business. But with the Taylors, I’m more confident that managers would seek to define the journalistic mission first, then figure out how to pay for it.

The Globe’s coming back tomorrow with a look at the Taylor group. I expect to see a photo of Steve and Ben dressed in tasteful, non-ostentatious business suits, their jackets off and their sleeves rolled up, serving meals at a homeless shelter before heading in to work.

Guild treasurer files charges against Totten

Boston Newspaper Guild treasurer Patrice Sneyd has filed charges against Guild president Dan Totten, according to Boston Globe reporter Robert Gavin. Totten is accused of misappropriating money or property, violating the union’s constitution and disobeying orders. The Guild is the largest union at the Globe.

Totten, out on leave, has previously denied any improprieties. Sneyd’s action could lead to an internal trial. Though it strikes me as odd that Totten could be accused of mishandling funds without law enforcement somehow becoming involved, perhaps we’ll find out soon exactly what has been going on. (Via Romenesko.)

Earlier coverage.

Guild treasurer addresses Totten charges

The following e-mail has been sent to the members of the Boston Newspaper Guild, the largest union at the Boston Globe. A copy was obtained by Media Nation earlier today.

September 25, 2009

Dear Colleague,

I understand that many questions have arisen from yesterday’s e-mail from the Executive Committee regarding alleged financial impropriety by BNG President Daniel Totten.

As treasurer, I have a fiduciary responsibility, which I take very seriously. I intend to fulfill that responsibility to the fullest extent.  I assure you that the Executive Committee is asserting due diligence on this matter. Once made aware of the situation, the appropriate steps were taken to ensure the safety of your union funds.

The second order of business was to notify you. It would have been preferable to notify you, and file the charges simultaneously. But time constraints did not allow that to happen. We took the position that notification was our next priority.

We are guided in this process by the constitution of the CWA [the Communications Workers of America], our parent union. The by-laws require that charges be filed within 60 days from the time an offense becomes known.  I intend to draft the charges and file them early next week with our Recording Secretary Kathy McCabe, as required by the by-laws. We are well within the 60 day time frame. After they are filed, members will be notified of the details of the charges.

I know that there may be more questions as this process moves forward. We are working with the guidance of legal counsel from both the CWA and the BNG. We will keep you updated as more information becomes available.

In closing, I ask for your patience.

In Unity,

Patrice Sneyd,
Treasurer BNG

What we still don’t know about Dan Totten

The Globe and the Herald today report that Boston Newspaper Guild president Dan Totten is suspected of signing someone else’s name as a countersignature on his paycheck. So here are a few follow-up questions:

  • Is this something he did regularly?
  • Did other union officials know it?
  • Have other union officials done the same?
  • Was this money to which he wasn’t entitled? (Surely he was entitled to his paycheck.)

To be sure, Totten, whose union is the Globe’s largest, shouldn’t have signed someone else’s name on a check, and it kind of sounds like he’s admitted that, according to the reports. But we still don’t know whether we’re talking about ill intent or just a seat-of-the-pants management style.

Meltdown at the Boston Newspaper Guild? (II)

More on the charges against Boston Newspaper Guild president Dan Totten, whose union is the Boston Globe’s largest, from the Boston Herald and the Globe.

I would be very cautious about drawing any conclusions based on the sketchy information that’s come out so far. This could be serious. Or it could be factional warfare.

Much more to come, I’m sure.

Meltdown at the Boston Newspaper Guild?

I will confess that I have been following contretemps within the Boston Newspaper Guild from afar, at best. But from the looks of an e-mail sent to Guild members this afternoon and obtained by the Phoenix’s Adam Reilly, it appears that a total meltdown is under way.

Dan Totten, the controversial president who led the union in talks with the Boston Globe’s corporate owner, the New York Times Co., during the spring and summer, has had his financial authority suspended, and an audit is being conducted, according to the e-mail from the Guild’s executive board.

This comes on top of a recall effort led by some Globe staffers who have accused Totten of inadequate communication — which another way of saying that the $10 million in concessions approved during the summer cut health benefits by considerably more than union members say they’d been led to believe.

Dropping the paper in order to save it

Maybe I’m part of the solution after all.

Media Nation has learned that the Sunday-versus-weekday revenue split at the Boston Globe may be more dramatic than I had previously heard. In 2008, the Monday-through-Friday editions brought in $113 million. The Saturday and Sunday papers’ take was $259 million — just a shade under 70 percent of the total.

I don’t have separate numbers for the Sunday paper alone. But, traditionally, Saturday papers are the smallest and least lucrative of the week, which means that the Sunday Globe accounts for the overwhelming majority of those weekend revenues. Several days ago, I wrote that the Sunday Globe was thought to account for 60 percent of revenues; it now appears that figure might have been low.

Given that, it makes sense for the Globe to push electronic distribution for its weekday papers as long as it’s done with an eye toward preserving the Sunday print edition. If the Globe could save on printing and distribution costs and entice weekday advertisers into the Sunday edition, its revenues might drop, but its profit margin could rise. (Or, since this is a newspaper we’re talking about, rematerialize.)

Also this morning, a couple of tidbits on the New York Times Co.’s efforts to sell the Globe:

• A bid by former Globe executive Stephen Taylor, a member of the family who sold the paper to the Times Co. in 1993, may be facing some obstacles. Word is that the group is still trying to line up investors. Not that those investors won’t be found, but it doesn’t sound like Taylor is ready to write a check just yet.

I also hear that the San Diego-based Platinum Equity group may be losing its ardor for the deal — which puts Taylor in a strong position if he can come up with the money. People are buzzing about the addition of former Globe publisher Ben Taylor (a cousin of Stephen’s) and longtime Boston journalist Mary McGrath to the Taylor group. But they’ve got to find the dough.

Given that the Taylors sold the Globe for $1.1 billion, and that they are now trying to buy it back (along with the Worcester Telegram & Gazette) for a mere fraction of that, you’d think money wouldn’t be a problem.

But the $1.1 billion was split among many, many members of the Taylor family. And investors these days aren’t exactly clamoring to get into the newspaper business.

• On the other hand, Poynter Institute media-business analyst Rick Edmonds writes that recent statements from the Times Co. suggesting it might hold onto the Globe are, in all likelihood, so much malarkey (via Ralph Ranalli at BeatthePress.org).

The reason: the Times Co. needs to take a loss by the end of 2009 in order to offset capital gains it’s realized by selling off other properties. In addition, Edmonds says:

I don’t think taxes alone would impel a sale. The Times Co. may also fear getting stuck with another round of operating losses (or find itself forced to lay off more employees, with renewed labor upheaval). Also, the company may have worn out its welcome both inside the paper and with Bostonians, who would welcome a Taylor family restoration.

As Ranalli notes, Edmonds is the guy who cracked the code earlier this year in explaining the Times Co.’s claim that the Globe was on track to lose $85 million. According to Edmonds’ analysis, though that number was real, the paper’s actual cash operating loss for 2009 would probably be around $20 million. All of a sudden, the Times Co.’s demand for $20 million in union concessions made sense.

When Times Co. chairman Arthur Sulzberger Jr. told Globe employees in August that the paper’s finances had improved and the company was in no hurry to sell, it struck me mainly as a ploy to drive up the price. Edmonds’ latest fits right in with that.

Photo (cc) by Tony the Misfit and republished here under a Creative Commons license. Some rights reserved.

The Taylor group gets two boosts

The Stephen Taylor-led group that’s seeking to buy the Boston Globe from the New York Times Co. is getting more interesting by the day.

Last week the Globe reported that the group includes Mary McGrath, who’s best-known for producing two Christopher Lydon-hosted shows on public radio, “The Connection” and “Open Source,” and who is a formidable journalist in her own right.

She also hails from a legendary family of journalists that includes her brother Charles “Chip” McGrath, a staff writer for the New York Times; her brother Jim McGrath, an editorial writer for the Albany Times Union; and her nephew Ben McGrath, a staff writer for the New Yorker.

On Saturday the Globe revealed that Stephen Taylor, a former high-level executive at the Globe, has been joined by his cousin Ben Taylor, a former Globe publisher who was removed by the Times Co. in 1999. (The Taylors sold the Globe to the Times Co. in 1993.)

Is it OK to start feeling optimistic?