The Boston Globe has been sold to Red Sox owner John Henry for $70 million in cash, a fraction of the $1.1 billion paid for it by the New York Times Co. in 1993.
The low price underscores the continued troubles plaguing the newspaper publishing industry as advertisers spend less on print and readers turn to free online content.
This is the first foray into newspapers for Henry, known as a soft-spoken, shy businessman who made his fortune through his hedge fund. Besides the Red Sox, his sports empire includes the New England Sports Network, Liverpool Soccer Club and Roush Fenway Racing, according to the Globe.
"The Boston Globe’s award-winning journalism as well as its rich history and tradition of excellence have established it as one of the most well respected media companies in the country,” Henry, 63, said in a statement. He cited the “essential role that its journalists and employees play in Boston, throughout New England, and beyond.”
The New York Times first put the paper up for sale in 2009 but pulled it off the table later that year. It began seeking buyers again in February and reportedly received interest from several parties.
Under the terms of the agreement, Henry will acquire the 141-year-old Globe newspaper, BostonGlobe.com, Boston.com, the Worcester Telegram & Gazette and Telegram.com. He will also get GlobeDirect.com, the Globe's direct-mail marketing company, as well as the company's 49% interest in Metro Boston.
Mark Thompson, president and chief executive of the New York Times Co., said in a statement that the deal would help it "sharpen our company focus on and investments in the New York Times brand and its journalism."
”We are very proud of the association we have had with the Boston Globe and the Worcester Telegram & Gazette and we’re delighted to have found a buyer in John Henry, who has strong local roots and a deep appreciation of the importance of these publications to the Greater Boston community,” Thompson said.
The New York Times Co., which owns its namesake paper and the International Herald Tribune, on Thursday reported second-quarter profit of $20.1 million, or 13 cents a share, compared with a loss of $87.6 million in the year-earlier quarter.
According to Forbes' profile of Henry on its top billionaires list this year, where he placed No. 974 worldwide with $1.5 billion, he made his money through his hedge fund, J.W. Henry & Co. He bought the Red Sox in 2002, resides in Boca Raton, Fla., is married and has two children.
The all-cash transaction is expected to close in 30 to 60 days.