After Fighting to Change Upper Tier Management at the New York Times, Major Investment Bank Morgan Stanley Sells Off $183 Million in Shares

Mick Gregory

The New York Times empire is crumbling. Look out for falling debris. Stock is at a 10-year low.

Now, it is the top headline on the Drudge Report.

Morgan Stanley, the second-biggest shareholder in New York Times Co., sold its entire 7.3 percent stake today, according to a citizen journalist who knew of the transaction, sending the stock to its lowest in more than 10 years.

The Sarbanes-Oxley Act didn’t do anything for investor rights of New York Times stock.

The person declined to be identified because Morgan Stanley hasn’t made the sale public yet. Traders with knowledge of the transaction said Merrill Lynch brokered a $183 million block trade of 10 million New York Times shares this morning.

Hassan Elmasry, managing director of Morgan Stanley Investment Management, unsuccessfully challenged the Sulzberger family’s control of New York Times Co. through super-voting stock that gives them a board majority. Shareholders owning 42 percent of the company, parent of the namesake newspaper and Boston Globe, withheld support for directors at the publisher’s April annual meeting.

“This guy has been speaking for a lot of people who are too discreet to speak up and challenge management,” said Porter Bibb, a managing partner at Mediatech Capital Partners LLC in New York and a former New York Times Co. executive.

New York Times shares slid 43 cents, or 2.3 percent, to $18.48 at 4:04 p.m. in New York Stock Exchange composite trading, the lowest since January 1997. The stock has declined 24 percent this year.

Other newspaper stocks, including Gannett Co., owner of USA Today, and McClatchy Co., publisher of the Miami Herald, are also trading at 10-year lows because of the loss of advertising to new media such as the Internet and the decline in classified ads linked to tumbling housing sales.

I predict before year’s in, money managers with any sense of economics and business management will follow and the New York Times stock will fall below $12 a share. Maybe some liberal movie stars could pool their money and end up owning the Old Gray Lady.

The dumping of the NYC stock by Morgan Stanley Investment Management marks the end of a two-year fight between one of the bank’s asset managers and the company.

Elmasry, had been conducting a well orchestrated campaign to spur the company to change its super-class share structure, which gives the members of the Ochs-Sulzberger family super voting power, leaving investors with no input on management decisions. It’s a stock strategy that is a holdover from the 19th century. It allows no converstations from stock holders.

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s