Slim betting on NY Times staying in business
Posted by Leah McBride Mensching on January 21, 2009 at 3:06 PM
Carlos Slim Helu, one of the world's wealthiest people, agreed earlier this week to loan the New York Times Company US$250 million. In tough economic times, Slim was able to drive a hard bargain, netting a 14 percent interest rate that adds up to $26 million in payments to him each year. The deal also means Slim gets warrants that are convertible to up to 17 percent of the company's equity.
However, Slim's deal with the Times Co. is unlike any previous scheme in which wealthy businessmen and women have invested in newspapers, and is also not about placing a bet on how far or fast the newspaper industry's financials will fall, according to Richard Siklos, Fortune magazine's editor-at-large.
However, Slim's deal with the Times Co. is unlike any previous scheme in which wealthy businessmen and women have invested in newspapers, and is also not about placing a bet on how far or fast the newspaper industry's financials will fall, according to Richard Siklos, Fortune magazine's editor-at-large.
Instead, Slim is betting that the Times Co. will stay in business.
Slim's $250 million will help the company deal with its $500 million in debt, to be paid over the next two years, Siklos points out in his Fortune article, posted by CNNMoney.com. The company is $1.1 billion in debt.
Although not all Slim's investments have panned out, such as his buying retailer CompUSA, he does believe that "great brands will persevere," one executive told Siklos, who noted Slim bought into Apple when it wasn't doing so well in the 1990s.
"We believe that with the strength of the New York Times brand, its national and international reach, its potential for digital expansion and most of all, its world-class news and information, the company will continue to be a leader in the media industry," Arturo Elias, director of Inmobiliaria Carso, one of Slim's companies, said in a statement, according to the Washington Post.
Slim's $250 million will help the company deal with its $500 million in debt, to be paid over the next two years, Siklos points out in his Fortune article, posted by CNNMoney.com. The company is $1.1 billion in debt.
Although not all Slim's investments have panned out, such as his buying retailer CompUSA, he does believe that "great brands will persevere," one executive told Siklos, who noted Slim bought into Apple when it wasn't doing so well in the 1990s.
"We believe that with the strength of the New York Times brand, its national and international reach, its potential for digital expansion and most of all, its world-class news and information, the company will continue to be a leader in the media industry," Arturo Elias, director of Inmobiliaria Carso, one of Slim's companies, said in a statement, according to the Washington Post.
0 TrackBacks
Listed below are links to blogs that reference this entry: Slim betting on NY Times staying in business.
TrackBack URL for this entry: http://www.editorsweblog.org/mt/mt-tb.cgi/16496
Leave a comment