The New York Times Company (NYSE: NYT) has hired Goldman Sachs Group Inc. (NYSE: GS) to "explore a potential sale" of the New England Media Group, according to a document filed Thursday with the Securities and Exchange Commission (SEC).
New England Media Group includes such assets as the Boston Globe, which was purchased for $1.1 billion back in 1993, as well as the Worcester Telegram & Gazette, which was acquired for $295 million in 2000.
Despite persistent rumors about the death of print media, there seems to be no shortage of bidders for the NYT division. Beth Healy of Boston.com (a unit of New England Media Group) reports that California-based Platinum Equity has emerged today as the group's third potential suitor. The two other interested parties are based out of Boston.
Today's news has NYT up 1.7% at last check. The stock has snapped out of the worst of its doldrums and edged its way to a year-to-date gain of nearly 11%, but the shares are now preparing to test resistance at the $9 level. This region previously rejected the equity's advances in mid-December 2008.
With the Times making moves to unload some assets and control costs, pessimism is gradually dwindling toward the media concern. While short interest still accounts for an impressive 13.4% of NYT's float, this figure is down nearly 3% from the previous reporting period. If traders continue to back away from their bearish stance -- providing a steady influx of buying pressure in the process -- the shares could soon be staring down the psychologically significant $10 level.
Elizabeth Harrow is an analyst and financial writer in the research department at Schaeffer's Investment Research. She is featured in the video series Schaeffer's Daily Q&A on SchaeffersResearch.com.
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