Arthur Sulzberger Jr, chairman of the family-controlled New York Times Company, announced yesterday that it would use funds from a fire sale of assets to reduce its $1 billion debt.
The statement comes after Wednesday's announcement that the New York Times Company, the parent company of the New York Times and the Boston Globe newspapers, would sell the classical music radio station WQXR. In a statement sent to staff, Sulzberger said: "We plan to use the proceeds from divestitures, such as WQXR and the potential sale of our interests in the Boston Red Sox, to bring our level of debt down even more."
He went on to add: "We strongly believe we have the financial strength and flexibility to manage through this difficult time."
Yesterday's sale of WQXR for $45 million is the latest in a series of debt reducing measures that include job cuts, wage reductions and the suspension of the quarterly dividend. Earlier this month the company also announced it is considering charging for its popular online news content.
In January, Mexican billionaire Carlos Slim Helu lent the company $250 million. In the statement yesterday Sulzberger said the 14% interest on the loan was "a high rate" but given the state of the economy the rate is "both fair and financially sound."
Sulzberger Jr became the fourth generation of his family to run the New York Times Company when he succeeded his father as chairman in 1997. The family retains voting control on the company board through its class B shares. Company revenues dropped throughout 2008 from $3.2 billion in January to $2.9 billion in December as the business suffers from a fall in advertising sales that has been exacerbated by the financial crisis.
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