* Offer to 5,200 former employees
* Represents 15 pct of pension liabilities of $1.99 bln
* Expects to record a noncash settlement charge in Q4
Sept 14 The New York Times Co is
offering some of its former employees a new payment option in an
effort to reduce pension liabilities, the company said in a
regulatory filing on Friday.
Pensions are a significant issue facing newspapers as the
industry deals with a severe drop in revenue from advertising.
At the same time publishers are responsible for funding
retirement plans for its swelling ranks of past employees as
well as current staffers.
The New York Times is putting on the table a choice between
a one-time lump payment or a lower monthly annuity targeted at
5,200 former employees. The qualifying former staffers represent
about 15 percent of the company's pension plan liabilities,
which stood at about $1.99 billion as of Dec. 25, the filing
"This offer is another step the company is taking to reduce
the size of its pension obligations and the volatility in the
company's overall financial condition," the company said in the
The pensions are underfunded by about $500 million.
The New York Times, which publishes its namesake newspaper
and the Boston Globe, has been shedding properties over the past
several years to streamline operations and shore up cash
reserves. It used to be a sprawling media conglomerate with
holdings in cable networks and sports teams like the Boston Red
Sox and Liverpool soccer club, and also owned broadcast TV
stations, magazines and a slew of newspapers throughout the
In the most recent example, it sold About.com for $300
million last month to Barry Diller's IAC-owned Ask.com.
The New York Times is also currently engaged in a tense
talks with the Newspaper Guild, which represents newsroom
employees, over a new contract. One of the sticking points
involves the company's pension plan.
In the offer announced on Friday, the one-time lump sum
payment would equal the present value of a pensioner's benefit,
payable in cash or rolled over into a qualified retirement plan
or individual retirement account.
The company expects to record a noncash settlement charge in
the fourth quarter of 2012.
Shares of the company were up 2 percent at $9.85 in morning
trading on Friday.