Estimated read time: 3-4 minutes
This archived news story is available only for your personal, non-commercial use. Information in the story may be outdated or superseded by additional information. Reading or replaying the story in its archived form does not constitute a republication of the story.
NEW YORK (AFX) - Shares in the New York Times Co. rose strongly on Wednesday after a published report indicated that Maurice "Hank" Greenberg, the deposed chairman of American International Group Inc., was buying stock in the newspaper publisher.
But after the market closed, a spokesman for Greenberg said he did not intend to significantly increase his holdings and the shares fell back.
Shares in the Times rose $1.73, or nearly 7.5 percent, to close at $24.76 on the New York Stock Exchange, but fell back about $1 a share in after-hours trading.
The New York Post, a tabloid competitor of the Times, reported Wednesday that Greenberg has been acquiring "hundreds of thousands" of shares in the newspaper company. The Post is owned by News Corp.
In addition to its flagship newspaper, The New York Times Co. also publishes the International Herald Tribune, The Boston Globe and 15 other daily newspapers. It also owns nine network-affiliated television stations and two New York radio stations as well as several Web operations, including About.com.
Earlier reports indicated that Greenberg also was considering a bid for Tribune Co., which has a number of newspaper holdings including the Los Angeles Times and the Chicago Tribune.
But late Wednesday, Mark Corallo, a spokesman for Greenberg, said the former AIG executive was not building a huge stake in the Times company.
"Mr. Greenberg owns a total of less than 100,000 shares of New York Times stock out of a total of more 143 million shares outstanding," Corallo said. "He has no present intention of significantly increasing his holding."
Earlier, analysts speculated that Greenberg's interest in the New York Times could increase pressure on company management, which has been the target of shareholder Morgan Stanley Investment Management. Morgan Stanley has asked the Times to eliminate its two classes of stock, which concentrate power in the newspaper's founding family, and make changes to its board.
Asked about the New York Post report, Times spokeswoman Catherine J. Mathis said the company had no interest in changing the so-called dual-class share structure, which cements control of the company by the Sulzberger family.
"The Ochs-Sulzberger family has given no indication of a desire to change the dual-class structure," she said. This was "designed to protect the editorial independence and integrity of The New York Times newspaper ... and, in these challenging times, that is what it is doing."
The report came a day after Citigroup analyst William Bird downgraded The Times to "sell" from "hold."
He took the action as part of a report suggesting that newspapers will probably continue to see declining operating profits for about five years, until online platforms overcome print-related losses.
A number of prominent figures have expressed interest in investing in the beleaguered newspaper industry.
Jack Welch, the longtime head of General Electric Co., and other investors reportedly have sought to buy The Boston Globe from the Times.
Los Angeles billionaires Eli Broad and Ronald W. Burkle also have an interest in the Los Angeles Times, which is owned by Tribune.
Greenberg stepped down as chairman and chief executive of AIG, one of the world's largest insurance companies, in March 2005 after New York Attorney General Eliot Spitzer launched an investigation into the company's accounting procedures. Spitzer alleged AIG used "deception and fraud" to make its financial condition appear stronger than it was to investors. Copyright 2006 Associated Press. All rights reserved. This material may not be
Copyright 2006 AFX News Limited. All Rights Reserved.
