Jack Welch, ad exec explore Boston Globe bid

/ Source: The Associated Press

A group including retired General Electric Co. Chief Executive Jack Welch and advertising executive Jack Connors may offer to buy The Boston Globe from The New York Times Co., Connors said Wednesday.

But Connors cautioned that no deal may materialize.

After the Globe reported about the possible bid on Wednesday, Connors issued a statement saying “the current speculation is very premature.

“I have conversations about possible business deals all the time, and 90 percent of them never move forward,” said Connors, co-founder of the Boston advertising firm of Hill Holliday.

A phone message seeking comment from Welch was not immediately returned.

The Globe, citing several unnamed executives who have participated in the discussions, said the potential partners are working with investment bankers at JPMorgan to evaluate a potential deal, and that JPMorgan has valued the Globe at $550 million to $600 million, below the $1.1 billion the Times Co. paid in 1993.

JPMorgan spokesman Adam Castellani declined to comment Wednesday.

The Times Co. has said the Globe, despite its continued weak financial results, is not for sale.

Catherine Mathis, Times Co. vice president of corporate communications, said in a statement: “It is our policy not to comment on potential acquisitions or divestitures. We constantly review our portfolio of properties to assess their continuing relevance to our strategy. We view the Globe as an important asset, and we have taken many steps that we believe will improve its performance.”

The Times Co. recently named P. Steven Ainsley, who had headed its regional newspapers, as the Globe’s new publisher.

Welch, 70, grew up in Salem and moved to Boston after his retirement. Welch, Connors, and Boston concessionaire Joseph O’Donnell are considering bringing together a small group of local partners for a bid.

The Globe and the Boston Herald, which also had a report of the talks, said Welch and Connors first discussed the possibility of buying the newspaper at a lunch about six weeks ago that included former Globe and Herald columnist Mike Barnicle.

Connors, 64, said Wednesday, “I’ve been an avid reader of the Globe my entire life, and I appreciate the important role the newspaper plays in the civic life of this community.”

Last Wednesday, Boston Newspaper Guild members rejected a proposed four-year contract with the Globe. That proposal would have tied future wage increases for the Globe’s largest union to revenue gains, but would exclude revenue from the newspaper’s www.boston.com Web site from the revenue formula that would trigger pay increases.

The next day, about two dozen local leaders, including Sen. Edward Kennedy, D-Mass., sent a letter to the Times Co., urging company Chairman Arthur Sulzberger Jr. to “invest in The Boston Globe and invest in the future of Globe employees — rather than look for new ways to get by with less and less.”

Sulzberger responded Tuesday in a letter to Massachusetts political leaders in which he praised the paper’s “quality journalism” and cited the paper’s six Pulitzer prizes since Times Co. bought the paper. He noted that the officials’ letter had acknowledged “these are very challenging times for the newspaper industry, and the Globe is not immune to those pressures.”

“We have taken many steps to put it on a more stable financial footing,” such as new print, online, and direct-mail products, Sulzberger wrote. “As we move ahead, we will remain focused on ensuring the long-term financial health of the Globe so that it can continue to fulfill its journalistic mission.”

Last Thursday, the Times Co. reported that advertising revenue for its New England Media Group — led by the Globe — fell 10 percent in the first nine months of this year compared with the same period a year earlier, while circulation revenue fell 6.2 percent.

A move to return the Globe to local ownership would mirror developments in other cities. A group of Philadelphia business leaders bought the Philadelphia Inquirer and the Philadelphia Daily News from McClatchy Co. for $515 million earlier this year. Other wealthy potential buyers have expressed interest in buying the Los Angeles Times and the Hartford Courant from Tribune Co.