Murdoch Agrees to Sell N.Y. Post to Developer

Rupert Murdoch agreed Sunday to sell the New York Post to real estate developer Peter S. Kalikow for a reported $37 million, but the deal is conditioned on Murdoch winning “sweeping” concessions from the newspaper’s unions.

Murdoch, the native Australian who has lost dozens of millions on the Post since 1976, expects to begin meeting with union leaders today to seek “significant reductions in labor costs” that Kalikow finds satisfactory.

Kalikow reportedly wants concessions worth $20 million.

In a prepared statement, Kalikow and Murdoch launched their public campaign to persuade the unions. “It’s right on the edge of financial collapse,” Kalikow said. “Unless there are significant union concessions, the future of the paper is grim.”

Among the proposals, Kalikow reportedly wants to eliminate the Post’s 250 delivery drivers and replace them with independent deliverers, a savings estimated at $6 million a year.

Union sources, however, called the deliverers non-negotiable, and said they will explore having Murdoch subsidize cost reductions by giving workers part of the sale price or establishing an employee ownership program.

As part of the deal, Kalikow will acquire the Post real estate in lower Manhattan estimated to be worth $35 million, meaning that he is acquiring the newspaper for only $2 million.

The deal also does not require Kalikow to continue operating the Post for three years, as Murdoch had wanted.

Murdoch said he chose Kalikow over other bidders because he “felt most comfortable” with him. Kalikow is close to conservative Republican New York Sen. Alphonse D’Amato and is active in Jewish charities.

He was included in Forbes magazine’s list in 1987 of the 400 richest Americans and on the Village Voice list in 1986 of New York’s worst landlords.

Kalikow has no publishing experience and is expected to name Peter Price, chairman of the glossy Avenue magazine in New York, as publisher.

Kalikow said he expects to keep many of the Post’s editors and staff, “but in doing so there must be a realistic look at the economics.”

Murdoch, who turned Post from a liberal afternoon daily into a politically conservative but sex-and-scandal oriented tabloid, is selling because federal regulation forbids his owning a television station and newspaper in the same city.