21 Jan 2009

Billionaire to invest $US250m in New York Times

5:37 pm on 21 January 2009

Mexican billionaire Carlos Slim is to invest $US250 million in the New York Times Company.

Mr Slim, 68, already owns 6.9% of the Times's stock. He will receive warrants in the company that could give him an eventual 17% interest in the publisher - making him one of the largest shareholders.

The agreement, announced on Monday night, is for six-year unsecured notes with an interest rate of 14%: 11% paid in cash and 3% in accrued interest.

The company owns The New York Times as well as The Boston Globe and other papers.

It is due to repay more than $US1.1 billion in debt in the next few years, as advertising revenue deteriorates.

The New York Times currently has $US46 million in cash, but a $US400 million credit facility is due to expire in May.

It is trying to sell its stake in a holding company that controls the Boston Red Sox baseball team and might sell more properties.

According to Forbes magazine, Mr Slim is the world's second-richest man with a net worth of $US60 billion.

Times chief financial officer James Follo said Mr Slim's interest is purely financial.

The Times has been controlled by the Ochs-Sulzberger family since 1896. Outsiders were allowed on its board last year for the first time.

Shares in the company fell 50 cents, or 7.8%, to $US5.91 on the New York Stock Exchange on Tuesday afternoon.