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No Concessions, No Sale : Murdoch Says N.Y. Post's Survival Is Up to Unions

February 09, 1988|Associated Press

NEW YORK — Rupert Murdoch told union leaders Monday that his effort to sell the New York Post will fail, and the newspaper will close by the end of next week unless employees agree to a 12% pay cut and other concessions totaling $24 million over three years.

"At this point, whether or not the Post survives is entirely up to the cooperation from our unions," Murdoch said in a statement issued after he met briefly with union leaders.

"If Feb. 19 comes and this paper closes down, it will be Rupert Murdoch who closes this paper, not the unions," countered George McDonald, president of the Allied Printing Trades Council, an umbrella group of newspaper unions.

"We've been used for him to get his price," McDonald said.

Murdoch announced Sunday that the tabloid would be sold to real estate developer Peter S. Kalikow for $37 million if Murdoch could obtain concessions designed to stem financial losses at the paper.

"Annual losses had been running at $15 million," Murdoch said. "Now they were running at a much higher rate, one that could no longer be justified."

Murdoch told the unions he wanted $8 million a year in savings for three years, the elimination of 77 of the paper's 1,200 jobs and 12% pay cuts across the board. A $2-million bonus was to be spread among all workers in the third year of the contract.

Employee Proposal

He said his contract with Kalikow called for the new buyer's withdrawal by Feb. 19 if the concessions were not granted. He said Kalikow had made a one-year written agreement to publish the Post and had assumed responsibility for severance and pensions, which were close to $40 million.

Union officials said their lawyers would file an unfair labor practice complaint with the National Labor Relations Board because they were presented with a non-negotiable package.

They also said they were working on their own proposal as buyer of last resort under an employee stock ownership trust.

Howard Rubenstein, a Post spokesman, said of the union purchase idea: "Mr. Murdoch said the real danger of the proposal raised peoples' hopes as if they were a mirage and he considered that irresponsible. He said it's too late and the door is closed."

Kalikow, 45, is the president of H. J. Kalikow & Co., a real estate concern, and owns about a dozen buildings in Manhattan. His fortune is estimated at $500 million.

He did not attend the Monday meeting with Murdoch, prompting a walkout by Jerry Cronin, president of the drivers and mail handlers' union, who said the developer was being shielded because "he won't answer the magic question. The magic question is how long will he keep the joint open."

Kalikow said through Rubenstein that he was not at the meeting because "Rupert Murdoch's organization still owns the paper and Murdoch is responsible for the cost savings."

He added: "It is my intention to stop the hemorrhaging of the New York Post. I am committed to expanding its readership base through millions of dollars in promotion and greatly expanding its advertising revenues to make the paper profitable on a long-term basis."

Murdoch has been under pressure to sell the Post, a continual money-loser.

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