Two of the country’s largest newspaper companies – Gatehouse and Gannett – have agreed to combine. GateHouse Media is buying USA Today owner Gannett Co. for $12.06 a share in cash and stock, or about $1.4 billion.
Mike Reed, chairman and CEO of GateHouse parent New Media Investment Group, will retain his title. Paul Bascobert, a former Bloomberg Businessweek executive, joins the new company as operating CEO.
“We believe this transaction will create value for our shareholders, greater opportunities for our employees, and a stronger future for journalism,” Reed said. “Gannett is an innovative, digitally-focused media and marketing solutions company with well-known brands worldwide.”
The Tallahassee Democrat is a Gannett owned paper.
The Wall Street Journal reported that the “deal combines the largest owner of U.S. newspapers by titles—GateHouse, with 400 papers and a total circulation of 4.29 million—and the largest newspaper group by circulation—Gannett, with a circulation of 4.32 million and 215 titles including USA Today, according to a University of North Carolina study.”
The deal is expected to be finalized by the end of 2019. Gannett shareholders will own roughly 49.5% of the combined company, with New Media shareholders owning the rest.
The companies said the deal will cut up to $300 million in costs annually and help speed up a digital transformation.
In addition to efficiencies from combining certain operations, newspaper economic analysts indicate that savings will come from the consolidation of top regional management positions.
Gatehouse Buys Gannett, Projects $300 Million in Cuts added by Steve Stewart on
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Proof that journalism is dead in the U.S. Not the merger, but the political activism by the print media that created the need for it.
Title Correction:
Gatehouse pay $1.4 Billion for a turd.
You are welcome!!!!
Apparently Gatehouse shareholders agree with the Snidester. Gatehouse stock is down another 17% today, ouch!
Stock dilution to help pay for the purchase.
Big mistake.
https://www.barrons.com/articles/new-media-stock-plunges-on-planned-merger-with-gannett-51565126310
“It seems pretty clear investors hate this deal.”
Folks, if you want to know how to successfully buy another company, don’t copy this Chinese fire drill.
UPDATE:
https://nypost.com/2019/08/07/new-media-deal-to-buy-usa-today-owner-gannett-is-hanging-on-for-dear-life/amp/
“Reed also will tell investors he plans to sell assets worth about $200 million next year to further reduce debt, the sources said. That likely means exiting some Florida papers where there’s overlap. The combined company would own both the Tallahassee Democrat and Naples Daily News.
Sen. Rick Scott: PLEASE BUY THE NAPLES PAPER! You could retire from the Senate, hang out at home with the grandkids, and be a de facto newspaper magnate!
Way more fun than battling Chucky Schmucky!
I am thankful. Seemore be in agreemant with Tony. It not wise to pay for a study to count papers. I thank they have two easy of a job trying to save 300 million because that study could be done free by google.I am thankful.
“Gannett, with a circulation of 4.32 million and 215 titles including USA Today, according to a University of North Carolina study.”” ************************** You had to do a STUDY to see how many New Papers Gannett owns? How much did THAT Study cost?
“We believe this transaction will create value for our shareholders…”
GateHouse stock (NEWM) is down 61% since early 2015.
“…greater opportunities for our employees…”
They’ll do the only thing they know how to do – more waves of layoffs. Eventually, data-mining software will be writing the stories, and they’ll crowdsourse visuals from social media, without compensation. “If someone said it, it’s true!”
“…and a stronger future for journalism.”
How is basically reducing America to ONE newspaper chain (voice) better for journalism? Would one party be better for elections too?
Diversity in America’s print media just took one giant step backwards.
Here’s another take on this, written before the merger was official:
https://www.floridaphoenix.com/2019/08/05/your-florida-news-landscape-might-be-about-to-change-a-lot/
Meanwhile, Gannett shareholders may initiate a shareholder lawsuit for breach of fiduciary duty:
https://finance.yahoo.com/news/shareholder-alert-ademi-oreilly-llp-220700045.html
They rejected a $12 hostile takeover bid 6 months ago because it was too low, but now they’re OK with $12.06?
So the Democrat is doomed?
The Fake Newsocrat was doomed Aug. 3, 2005, when Knight-Ridder sold it to Gannett.
A Day of Journalistic Infamy.