As news of The New York Times Co.’s plans to sell The Boston Globe filtered through media and investor circles Thursday, speculation mounted about would-be buyers for New England’s largest newspaper.
Most people were still digesting the news, and the process of soliciting bids was in its earliest stages, according to people briefed on the effort. So the handicapping went first to known media buyers who have been in the market lately, including some who had expressed interest in the Globe.
For instance: Aaron Kushner, the Wellesley businessman and former greeting card executive had his eye on the Globe in 2011 and assembled a group of investors but made no headway with the Times Co. He moved on to the Portland Press Herald in Maine the next year, but a deal to buy that paper fell apart. Later in 2012, he fared better on the West Coast, buying the Orange County Register and five other California papers owned by Freedom Communications Inc. for about $400 million.
At the Register, Kushner has staked out an unusual strategy in an era of media downsizing. He has hired dozens of journalists, expanded the number of news pages, created a stand-alone business section, and beefed up the newspaper’s investigative staff, among other investments.
Friends say he isn’t done yet. Kushner recently expressed interest in acquiring the Los Angeles Times and has not lost interest in the Globe, they say.
Kushner, through a spokesman, declined to comment.
The Times Co. on Wednesday said it has hired investment bankers at Evercore Partners in New York to help sell its New England Media Group, which includes the Globe, the Worcester Telegram & Gazette and several online and related properties. The Times tried to sell the group in 2009 but changed its mind when bids came in low.
Newspaper executives and analysts following the sale of the Globe noted that the media environment has improved since 2009, when the economy was blanketed in recession and many news outlets, including the Globe, were losing money. The Globe made an operating profit in both 2011 and 2012.
Generally, newspapers are commanding prices of four to five times their cash flow, according to several industry analysts and former industry executives. The Globe generated $20 million to $30 million in free cash flow last year, according to analyst estimates, which would put a sale price at $80 million to $150 million, based on those assumptions.
One Wall Street analyst, whose firm does not permit him to publicly discuss media deals, put the Globe’s value at $120 million, citing a strong brand that will likely attract local buyers.
Tom Matlack, an investor and former chief financial officer of the Providence Journal Co. who took that company public and helped sell it in 1997, put a potential price on the Globe of $60 million to $80 million, assuming the Times Co. keeps the pension liabilities.
That’s in line with the $70 million unofficial bid — excluding pension liabilities —Kushner floated with the Times Co. in 2011, according to people who were briefed on the matter and spoke on condition of anonymity because they were not authorized to discuss it publicly.
“For some of these assets, ego takes over, and a local investor might pay significantly more,’’ Matlack said.
The appetite for newspaper acquisitions has changed markedly since the Times Co. pulled the Globe off the market in 2009. More investors are now expressing interest in acquiring newspapers, and most that go up for sale are finding buyers, although with varying results.
One investor with a change of heart has been billionaire Warren Buffett. In 2009, Buffett declared he would not purchase newspapers at any price. But he went on a buying spree last year, acquiring 63 papers from Media General for $142 million and a stake in a smaller media company called Lee Enterprises. Earlier this month, Buffett added the News & Record in Greensboro, N.C., to his portfolio.
The Globe is a much larger business than those recently acquired by Buffett, who has focused on smaller papers in markets with less competition.
Buffett was among the Globe’s largest investors when it went public as Affiliated Publications Inc. in the 1970s. And he has long been an investor in the Washington Post.
A spokesman for Buffett did not return a call seeking comment on the Globe sale.
Other players in the market include Platinum Equity, a Beverly Hills private equity firm that pursued the Globe in 2009. Platinum bought the San Diego Union-Tribune that year and sold it in 2011 to local entrepreneur Doug Manchester for a reported $110 million. A spokesman for Platinum did not return a call seeking comment Thursday.
Another potential suitor is Jack Griffin, a publishing executive who previously teamed up with Kushner in his efforts to acquire the Portland Press Herald and other newspapers. Griffin was ousted as chief executive of Time Inc. in 2011 and has since established Empirical Strategic Advisors, a consulting firm for media and technology businesses with offices in Boston and New York. Through a spokesman, Griffin declined to comment on the sale of the Globe.
Richard Daniels, a former Globe executive, and Heb Ryan, an investor in Boston, had contacted the Times last year and may also remain interested. Ryan did not respond to requests for comment; Daniels could not be reached.
Rupert Murdoch, the chief executive of News Corp., which owns the Wall Street Journal, the New York Post and many other media outlets, has expressed interest in the Los Angeles Times and the Chicago Tribune, as their owner, Tribune Co., emerged from bankruptcy in December. Analysts said Murdoch is likely to be more interested in those markets than in Boston.
A spokesman for Murdoch declined to comment.
Lou Ureneck, a journalism professor at Boston University’s College of Communication, said the Globe is likely to be more attractive because of the cost cuts made under the Times Co.
The challenge, he said, will be to continue to increase the number of readers who pay for online subscriptions. The Globe had 28,000 paid online-only subscribers on BostonGlobe.com at the end of 2012, about a year after its launch.
Matlack concurred. “Any buyer would look to keep monetizing and growing a strong digital brand,” he said.
Increasing the number of online subscribers, Ureneck said, will be key in the years ahead. “I think there is a successful and profitable future for the Globe, but it’s going to be a slow and painstaking process,” he said.
Ross can be reached at firstname.lastname@example.org.