NEW YORK (AdAge.com) -- The New York Times Co. has secured a $250 million infusion from Mexican cellphone magnate Carlos Slim Helu and his conglomerate, Grupo Carso.
With his most recent investment, Mr. Slim becomes the company's largest shareholder. In exchange for that upfront sum, Mr. Slim -- who before the agreement was the company's fourth-largest shareholder -- will receive six-year notes with warrants that are convertible to common shares. The notes carry a 14% interest rate, with 11% paid in cash and 3% in additional bonds, according to the Times.
"This agreement provides us with increased financial flexibility to continue to execute on our long-term strategy," said New York Times Co. CEO Janet L. Robinson in a statement. "We continue to explore other financing initiatives and are focused on reducing our total debt through the cash we generate from our businesses and the decisive steps we have taken to reduce costs, lower capital spending, decrease our dividend and rebalance our portfolio of assets."
The company will use the investment to refinance debt. It has two revolving credit lines worth $400 million, one of which is set to expire this May.
Mr. Slim and members of his family are the main shareholders of Grupo Financiero Inbursa, the parent company of Banco Inbursa, and own Inmobiliaria Carso, which holds 6.9% of the Times Co.'s Class A shares. Forbes magazine estimated his total worth last year at about $60 billion.
The New York Times Co. has also put its stake in the Boston Red Sox up for sale and said last year it would borrow as much as $225 million against its new headquarters in Manhattan through a sale-leaseback agreement.