(Reuters) - The New York Times Co has received multiple bids for The Boston Globe, according to a source familiar with the auction of the daily newspaper.
The size and the precise number of the bids by the deadline at 5 pm EDT was not immediately clear though it is likely the New York Times will receive less than 10 percent of the $1.1 billion that it paid for the Globe 20 years ago.
It is the second time that the company has put the paper, and its smaller sister publication, the Worcester Telegram & Gazette, on the block. But with the financial outlook for the New England newspapers and the industry as a whole continuing to deteriorate, there is a greater sense of urgency to get something done this time.
Analysts estimate the New York Times may get only about $100 million for the two papers. It paid $1.1 billion to the Taylor family for the Globe in 1993, and in 2000 it bought the Worcester Telegram & Gazette for nearly $300 million.
The Taylor family is one of the parties that might be interested in the Globe, according to a source familiar with the family. Steve Taylor, a former executive at the Boston Globe and a member of the Taylor family, did not immediately return a call seeking comment.
Other potential bidders could include the private equity firm Revolution Capital Group, which owns the Tampa Tribune, and Doug Manchester who bought the U-T San Diego paper according to a report in the Boston Globe last week.
“They (the New York Times) would be better served getting less money and getting out of it,” said Ken Doctor, an analyst with Outsell Research.
Revenue at the New England Media Group - the division for the two papers and related properties - has been on a downward trajectory. For the first quarter, revenue fell 7 percent to $85.2 million on declines in advertising and circulation. It has declined 19 percent since the first quarter of 2009.
The Boston Globe made a small operating profit last year, a source familiar with the newspaper said, but it is unclear how sustainable that would be, particularly as a standalone operation.
Among the factors that could depress the prices bidders are prepared to pay are the newspapers’ significant pension obligations and the difficulty of negotiating changes with more than a dozen labor unions that represent about three-quarters of employees.
The New York Times first put the Globe up for sale in 2009 as it struggled with losses. But it halted the sale process and decided to hang onto the paper after winning concessions from unions and implementing cost cuts.
The New York Times has been slimming down, selling newspapers, Internet assets and stakes in sports franchises to concentrate on its flagship newspaper.
The Globe is one of a series of newspapers to go on the block in recent years as long-time newspaper owners exit the industry.
The Tribune Co, for example, is exploring the sale of its newspaper division, which includes The Los Angeles Times and the Chicago Tribune.
Reporting by Jennifer Saba in New York; Edited by Martin Howell and Tim Dobbyn