May 11 (Bloomberg) -- Billionaire David Geffen is interested in buying the New York Times Co. and offered to acquire the stake held by the company’s biggest investor, according to a person with knowledge of the proposal.

Geffen offered to acquire Harbinger Capital Partners LLC’s 28.5 million-share stake in New York Times on May 1 at market value, said the person, who asked not to be named because the discussions were private.

Discussions with Geffen ended when Harbinger sought a premium for its shares, according to the person. While the company isn’t for sale, he remains interested, the person said. Geffen, 66, offered $2 billion for the Los Angeles Times in 2006 and his bid was rejected by Tribune Co. He is no longer interested in owning the Los Angeles Times, said the person.

New York Times, controlled by the Sulzberger family, has climbed 26 percent since Geffen’s offer, which valued Harbinger’s stake at about $154 million. The shares rose 33 cents to $6.81 today in New York Stock Exchange composite trading.

Fortune magazine earlier reported Geffen’s interest.

Geffen co-founded DreamWorks SKG with Steven Spielberg and Jeffrey Katzenberg in 1994. He started Asylum Records and Geffen Records earlier in his career.

Harbinger, run by investor Philip Falcone, won two seats on the New York Times’ 15-member board last year as the fund amassed a 20 percent stake. New York Times shares are down 61 percent since the beginning of 2008.

Marcia Horowitz, a Harbinger spokeswoman, didn’t immediately return a voice message left after regular business hours. New York Times spokeswoman Catherine Mathis declined to comment.

To contact the reporter on this story: Andy Fixmer in Los Angeles at afixmer@bloomberg.net; or Greg Bensinger in New York at gbensinger1@bloomberg.net.

Last Updated: May 11, 2009 21:24 EDT