Gannett to merge with GateHouse Media
Source: Washington Post
America’s two largest newspaper publishers will merge in an effort to combat declining circulation and plunging advertising revenue, but will still face pressure to cut costs at hundreds of already cash-strapped publications around the country. The combination of McLean-based Gannett and GateHouse Media, based in Pittsford, N.Y., will create a conglomerate that will own more than 250 daily newspapers and hundreds of weekly and community papers.
GateHouse’s parent, New Media Investment Group, will purchase Gannett for $12.06 in cash and stock per share. Paul Bascobert, former chief marketing officer of Dow Jones, has been named chief executive of the combined company. Analysts say the combined company could generate hundreds of millions of dollars in savings from reduced overhead and more efficient printing and distribution, which could help stave off the effects of an industry in deep decline.
The combined company will also enjoy an expanded digital platform that executives are expected to pitch as an attraction to advertisers. GateHouse, owned by New Media Investment Group, publishes 156 daily newspapers and 464 community newspapers, reaching more than 22 million people each week. Gannett remains the country’s largest publisher by circulation, led by its flagship USA Today and big-city publications including the Indianapolis Star and Louisville Courier-Journal. “Bigger is better if you’re going after digital reach," said Doug Arthur, an analyst at Huber Research. “So there will be a lengthy conversation around how this is going to be a digital powerhouse.”
Greater digital ambitions aren’t likely to spare more short-term newsroom cuts, which have already ravaged the local news industry in recent years. Whatever the ownership structure of newspapers, so many of them have closed in recent years that there are at least 1,800 fewer newspapers in America than there were 2004, according to a study by the University of North Carolina. Employment in the newspaper industry fell about 47 percent between 2008 and 2018, a decline worse than coal mining over roughly the same period.
Read more: https://www.washingtonpost.com/business/2019/08/05/gannett-merge-with-gatehouse-media/?utm_term=.049da4b1a82f
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