Shareholder Report Criticizes NY Times Co. Stock Class Structure
November 6, 2006 at 5:41 AM (PT)
A report from a major institutional shareholder of THE NEW YORK TIMES CO. criticizes the controlling SULZBERGER family trust for failing to represent other investors' interests. The report, written by DAVIS GLOBAL ADVISORS INC.'s STEPHEN DAVIS and commissioned by MORGAN STANLEY, says that the company's underperformance leaves it "increasingly vulnerable to criticism that it has eschewed excellence in favor of antiquated frameworks that retard corporate accountability."
MORGAN STANLEY fund manager HASSAN ELMASRY has been pushing for the TIMES to drop the dual-class share structure that leaves the SULZBERGERS in control with no way for other shareholders to change the situation. The SULZBERGERS own close to 90% of the shares that can name 70% of the company's directors, while other investors can name only 30% of the board.
The TIMES owns Classical WQXR/NEW YORK and holds the license for RADIO DISNEY's WQEW-A/NEW YORK, which ABC operates and has an option to buy that may be exercised at the end of the present LMA at the end of the year.