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10-17-2007, 07:35 PM #1
Morgan Stanley Sells Entire New York Times Stake
NY Times is not the renowned paper that it once was. It has turned into another arm of the Liberal cause. See where this got it..........
Morgan Stanley Sells Entire New York Times Stake
http://quote.bloomberg.com/apps/news...d=aY9iww4X.01g
Oct. 17 (Bloomberg) -- Morgan Stanley, the second-biggest shareholder in New York Times Co., sold its entire 7.3 percent stake today, according to a person briefed on the transaction, sending the stock to its lowest in more than 10 years.
The person declined to be identified because Morgan Stanley hasn't made the sale public yet. Traders with knowledge of the transaction said Merrill Lynch & Co. brokered a $183 million block trade of 10 million New York Times shares this morning.
Hassan Elmasry, managing director of Morgan Stanley Investment Management, unsuccessfully challenged the Sulzberger family's control of New York Times Co. through super-voting stock that gives them a board majority. Shareholders owning 42 percent of the company, parent of the namesake newspaper and Boston Globe, withheld support for directors at the publisher's April annual meeting.
``This guy has been speaking for a lot of people who are too discreet to speak up and challenge management,'' said Porter Bibb, a managing partner at Mediatech Capital Partners LLC in New York and a former New York Times Co. executive.
New York Times shares slid 43 cents, or 2.3 percent, to $18.48 at 4:04 p.m. in New York Stock Exchange composite trading, the lowest since January 1997. The stock has declined 24 percent this year.
Other newspaper stocks, including Gannett Co., owner of USA Today, and McClatchy Co., publisher of the Miami Herald, are also trading at 10-year lows because of the loss of advertising to new media such as the Internet and the decline in classified ads linked to tumbling housing sales.
Pressure
Gannett, based in McLean, Virginia, said today third- quarter profit fell 10 percent because of a drop in classified advertising and television revenue. New York Times reports third-quarter results on Oct. 23.
Elmasry has pressured New York Times Chairman and Publisher Arthur Sulzberger Jr. for more than 1 1/2 years to eliminate the special class of stock that allows the Sulzberger and Ochs families to appoint nine of the company's 13 directors.
During the campaign, Elmasry also called on Sulzberger, 56, to relinquish one of his two titles at the New York-based publishing company.
Chief Executive Officer Janet Robinson said in December that the Sulzberger family has no intention of eliminating the dual-class stock structure, and that the board is comfortable with Sulzberger holding the title of chairman and publisher.
Shareholders have also criticized the company for spending $410 million to acquire the About.com Web site in March 2005 and $500 million on a new headquarters. In response, the company said its Manhattan skyscraper is now worth more than $1 billion, and About.com's sales rose 28 percent in the second quarter to $23.5 million.
Next Step
If Elmasry has sold the stock, ``it's almost a dead certainty there would be a bailout of other institutional holders,'' Bibb said in an interview. ``If that happens and there is a sharp drop in the share price, the Sulzbergers have to sit down and decide whether now is not a good time to take the company private.''
T. Rowe Price Group Inc., New York Times' largest shareholder with a 14 percent stake, had no immediate comment, said spokesman Steve Norwitz. Morgan Stanley held 10.5 million New York Times shares, or a 7.3 percent stake, as of June 30, making the company the second-largest institutional investor.
A spokesman for Elmasry declined to comment. The company has held New York Times shares on behalf of clients since 1996. Catherine Mathis, a New York Times spokeswoman, also declined to comment.
New York Times doesn't own television stations or investments outside of newspapers that might counter the decline in print advertising. Gannett, the largest U.S. publisher, owns 23 local stations.
New York Times sold its television stations in May for $575 million in order to pay down debt.
U.S. Securities and Exchange Commission rules prevented Morgan Stanley's asset management arm from using the firm's brokerage to handle the trade. The rules are designed to keep brokerages from giving the best prices to their own firm's shares at the expense of other customers.
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