Finance Expert: NYT Shareholders Unlikely To Object Over Manchester’s Failed Bid
Monday, August 5, 2013
U-T San Diego CEO John Lynch objects to the sale of The Boston Globe to John Henry, saying shareholders could block the sale.
The owners of U-T San Diego had been in the market to expand their media empire. John Lynch and Doug Manchester made a bid to buy The Boston Globe from The New York Times Company.
On Friday, The New York Times Company announced it was selling The Globe to the owner of the Boston Red Sox, John Henry. Henry paid $70 million cash.
Over the weekend, Lynch railed against the sale.
He told The Boston Herald that he and Manchester offered more money than Henry and would have bid even more.
Lynch did not respond to requests for comment and did not tell The Herald how much he and Manchester bid. But, he said, because he offered more money, shareholders could object to the sale.
"I’m just stunned," he told The Herald. "I thought this was a public company that had a fiduciary duty to get the most by its stockholders. ... From the beginning, I don’t think they wanted to sell to us.”
On Monday, The Boston Globe reported that three of the bidders said they offered more than Henry.
Nikhil Varaiya, a finance professor at San Diego State University, said it's possible, but unlikely, that some shareholders could try to block the sale.
"There's nothing to say that a shareholder cannot come out and say that they did not try to get the best deal possible," he said. "Then, in that case they have to challenge. The extreme would be to try to sue the board and the company."
Varaiya pointed out the New York Times' board of directors already approved the sale, and they would know the dollar amount of each bid.
He said it's more likely Lynch is complaining to try to get back the money he and Manchester spent preparing their bid. Lynch declined to tell The Herald whether they would sue to recoup their expenses.