Gray Lady Tosses in Towel for Net Unit IPO
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Citing unfavorable market conditions, The New York Times Company Thursday formally withdrew its proposed IPO of a tracking stock of New York Times Digital, its Internet business division.
The offering had been postponed earlier this summer. The publishing concern, which includes NYTimes.com and Boston.com, originally expected to complete the $100-million offering in the third quarter and has been waiting patiently for market conditions to improve. But now it appears the deal won't even be done in the fourth quarter.
"It's quite evident that today's market is bearish on Internet companies, regardless of how well they are performing," said Martin Nisenholtz, chief executive officer of New York Times Digital. "If we proceeded with the offering now, we would not receive the valuation we deserve. In addition, withdrawing the registration statement will allow us to talk more openly about our business and about how NYTD is winning in this space. We look forward to proceeding with a public offering when the market improves."
The company originally filed its S-3 registration statement on Jan. 28. But following the April shakeout that punished the Nasdaq Composite index over a 15-day period, The New York Times Company postponed the offering in the summer. No sooner did things begin to look better when tech stocks took another beating amid concern over gloomy third quarter results.
The withdrawal of the S-3 registration form will not affect NYTD's day-to-day operations or its expansion plans, the company said. NYTD said it retains its goal of achieving positive EBITDA for 2002, adding that its revenue grew 148.4 percent in the first nine months of 2000, as compared to the same period a year ago. It also reported that its NYTimes.com site had 12.8 million registered users in August 2000, a 49.7 percent increase over the same period last year.
"New York Times Digital has made tremendous strides in the past year and continues to exceed our expectations," said Arthur Sulzberger Jr., chairman of The New York Times Company. "NYTD has quickly grown into one of the leading sources of news, information and interaction on the Web. We remain committed to building our Internet business, which continues to be a significant part of our company's growth strategy."