Gannett to buy Journal Media Group for $280 million

October 09 07:47 2015

Gannett, the publishing company that owns USA TODAY and media businesses in 92 local markets, said late Wednesday that it has agreed to buy Journal Media Group for about $280 million, following through on a strategy of acquiring additional local news outlets after it was spun off from its former parent in June. Shareholders of Milwaukee-based Journal Media Group will receive $12 a share in cash. That is a 45% premium from the Wednesday closing price of $8.30.

Journal Media Group (JMG) owns the 178-year-old Milwaukee Journal Sentinel, The Commercial Appeal of Memphis, 15 other daily newspapers, 18 weeklies and their affiliated websites in 14 U.S. markets. The deal is expected to close in the first quarter of 2016. It was approved by both companies’ boards of directors and is subject to approval from Journal Media Group shareholders. Shares of Gannett closed at $14.94, up almost 4%.

Gannett (GCI), based in McLean, Va., will finance the deal through cash and borrowing under the company’s $500 million revolving credit line. “Gannett is excited to be joining forces with an organization that is so respected by their communities and industry,” Gannett Chief Executive Robert Dickey said. “Just over 100 days ago we laid out the importance of expanding our local market footprint, and we are very pleased that our acquisition strategy has kicked off with such a highly regarded company.

“This transaction will allow us to focus on creating quality journalism for our communities while building substantial value for our shareholders,” he said. “We welcome the employees of the Journal Media Group into the Gannett family and look forward to continuing to be an industry leader.” After the deal, Gannett will have a media outlet in 106 local markets in the U.S. It will result in “a combined digital audience of more than 100 million unique visitors a month,” the company said. The company’s print circulation will rise by about 675,000 weekdays and 950,000 Sundays.