Will Mexican tycoon save the NY Times?
The second-richest man in the world, Mexican billionaire Carlos Slim Helu, is taking a chance on the New York Times by purchasing a 6.4 percent in the company. He now owns 9.1 million shares which are worth about $138.6 million. He's now the third-largest shareholder in the company.
At one time, purchasing stock in the NY Times Company would have been a no-brainer for a savvy stock investor. But times have changed. Fewer people are reading newspapers, so advertisers are opting for space in other kinds of media. Shares in the NY Times had slumped to a 10-year low in July.
Stock analysts are perplexed about the position Slim has taken, but they're also intrigued. It has created some stir in the investor community as Slim has a reputation for spotting a winner where others see only losers.
Can he see something there that they are missing? If so, he's not saying what the attraction is, characterizing it as “exclusively a financial transaction.”
The Times has expanded its presence beyond print media by establishing a strong online presence, which may help it survive in this intimidating economic climate. Others note, however, that advertisers have not flocked to its site.
Slim had the foresight in 1990 to buy Mexico's state-owned telephone company, Telmex. That investment turned to gold and made his fortune, which he then expanded into retail, construction, mining, banking and insurance. His America Movil, a Telmex spinoff, is now Latin America's largest mobile phone company.
The stock made a nice move Thursday on the news of Slim's investment, advancing 9.1 percent to $15.23. Only time will tell if Slim sees a winner where others see a clunker. But for a man who's worth an estimated $60 billion, a losing bet of $130 million would hardly affect his balance sheet.
Tags: Carlos Slim , Mexican Billionaires , New York Times , Print Media , Internet Media
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