Our Terms of Service and Privacy Policy have changed.

By continuing to use this site, you are agreeing to the new Privacy Policy and Terms of Service.

New York Times stock surges on takeover talk

chart_ws_stock_newyorktimesco.top.png By Ben Rooney, staff reporter


NEW YORK (CNNMoney.com) -- Shares of the New York Times Company jumped Wednesday on rumors that the world's richest man could increase his stake in the newspaper publisher.

The stock gained 62 cents, or 7.9%, to close at $8.38 per share. Despite the advance, shares of the publisher of the New York Times are down 32% so far this year.

The rally was driven by renewed speculation that Carlos Slim, the Mexican telecom mogul who replaced Bill Gates as the world's richest man earlier this year, is interested in buying the New York Times Company (NYT). The chatter later in the day was that Slim, who owns 6.9% of the company's Class A shares, could increase his stake.

"The stock started strong on heavy volume, and there was a fair amount of option activity at the $9 strike price," said Douglas Arthur, an analyst at Evercore Partners. "The Slim rumor always surfaces when that happens because of his equity stake in the company and the warrants he owns to buy 16% of the stock."

In addition to his equity interest, Slim also injected $250 million into the Times company last year as it struggled to restructure a heavy debt load. Like many other publishers, the Times company suffered as spending on advertising, which makes up the bulk of revenues for most newspapers, dried up during the recession.

Diane McNulty, a spokeswoman for the Times company, declined to comment.

It's unlikely that Slim could buy control the publisher, since members of the Ochs-Sulzberger family, who own a majority of the Times' class B shares, would have to agree to any takeover.

"There's no way he can take over the company," said Edward Atorino, an analyst at the Benchmark Company, adding that speculation about Slim increasing his stake is slightly more plausible.

The decline in advertising revenue has slowed recently and the Times company is likely to remain a leader in the industry, he said. "Maybe [Slim] thinks the timing is right."

The Times' stock lagged rival publisher Gannett (GCI, Fortune 500) last year and could be poised for a rebound this year, said Morningstar analyst Joscelyn Mackay. "This is a company that's going to look better the second we emerge from the recession," she said.

Still, the Times company has been the subject of takeover rumors before, which ultimately proved false. "These rumors surface from time to time, take on a life of their own, and then peter out," said Arthur. To top of page

Index Last Change % Change
Dow 17,745.98 -5.41 -0.03%
Nasdaq 5,128.79 17.05 0.33%
S&P 500 2,108.63 0.06 0.00%
Treasuries 2.27 -0.01 -0.48%
Data as of 6:03am ET
Company Price Change % Change
Facebook Inc 95.21 -1.78 -1.84%
Bank of America Corp... 18.13 -0.03 -0.17%
Microsoft Corp 46.88 0.59 1.27%
Whole Foods Market I... 36.08 -4.74 -11.61%
Ford Motor Co 15.10 -0.11 -0.72%
Data as of Jul 30
Sponsors

Sections

Loosening state restrictions have given gun silencer sales a boost. Silencers are now legal in 41 states, compared to 37 four years ago. Also some gun makers are making it easy to attach them. More

Pinterest reveals its diversity numbers and announces how it plans to diversify its workforce. More

Fast-food chains that operate in more than 30 locations nationwide are the sole target of a new rule in New York to hike their minimum wage to $15. But consumers and small business owners, as well as some employees, may be the ones to pay the price. More

You can't blame it on the economy anymore. More Millennials now have jobs, but are still living at home. More