The New York Times Co. (NYSE: NYT) has closed the previously announced sale of its About Group to IAC/Interactive Corp. (NASDAQ: IACI). The sale did include the websites About.com, ConsumerSearch.com and CalorieCount.com in the offering. What matters is that the New York Times will now receive $290 million or so in total cash, based on the $300 million sale price.
In the press release, the New York Times said that it plans to use the capital brought in from the sale proceeds for general corporate purposes. Unfortunately, it did not specify what that really entails.
New York Times has a market value of about $1.4 billion. As of June 30 it had some $638 million in cash and short-term and long-term securities. That figure is now closer to $930 million, if you can use straight-line math on the balance sheet. What is at issue is the long-term debt of $700 million against the value of other assets that the media player holds.
Analysts currently project $0.69 earnings per share (EPS) and $2.07 billion in sales for 2012 and $0.66 EPS and $2.07 billion in sales for 2013. We will have to see how the analysts change their figures to account for this sale.
JON C. OGG
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