Holder Hammers N.Y. Times

The Morgan Stanley move comes as shareholder activists have taken increasing aim at managers and directors of underperforming companies. Carl Icahn took on Time Warner (TWX Quote) last year in perhaps the most widely reported face-off, though that effort ended in a standstill when Time Warner chief Dick Parsons gave in to Icahn's demands for a bigger stock buyback while ignoring his pleas for a four-way company breakup.

Newspaper companies also have been afflicted by a decline in their core business, facing rising production costs and drops in circulation and advertising revenue. Earlier this spring Knight Ridder (KRI Quote) gave in to activists who demanded a sale, parceling itself off to McClatchy (MNI Quote), which turned around and said it would try to get rid of 12 of the 32 acquired papers.

Benchmark Capital's Ed Atorino says any shareholder revolt could be "rather fruitless" given that the controlling family controls nine of the 13 board seats and 88% of the class B shares. Benchmark doesn't hold NYT shares.

Atorino notes that Private Capital Managment is a 14% shareholder in the New York Times Co. and that T Rowe Price also has large holdings. PCM's Bruce Sherman was the principal source of shareholder agitation at Knight Ridder, due to his unhappiness with the performance of that newspaper holding company.

On Tuesday, New York Times rose 14 cents to $25.16.