Log in
E-mail
Password
Remember
Forgot password ?
Become a member for free
Sign up
Sign up
Settings
Settings
Dynamic quotes 
OFFON

MarketScreener Homepage  >  Equities  >  Nyse  >  Gannett Co Inc    GCI

GANNETT CO INC

(GCI)
  Report  
SummaryQuotesChartsNewsCalendarCompanyFinancialsConsensusRevisions 
News SummaryMost relevantAll newsOfficial PublicationsSector newsAnalyst Recommendations

Gannett And Rival Close In On Deal -- WSJ

share with twitter share with LinkedIn share with facebook
share via e-mail
0
07/19/2019 | 02:49am EDT

By Cara Lombardo and Dana Cimilluca

USA Today publisher Gannett Co. is nearing a deal to combine with rival GateHouse Media, people familiar with the matter said, a move that would join the nation's two largest newspaper groups by circulation at a time local media is in a battle for survival.

The companies are grappling with a brutal environment for local newspapers around the country. Private-equity-backed GateHouse has a reputation for aggressively slashing expenses at titles it acquires.

Local papers have suffered particularly sharp declines in circulation compared to national outlets as readers look elsewhere for news and classified ads disappear. They have also lost more of their online-advertising business to tech giants such as Facebook Inc. and Alphabet Inc.'s Google.

Nearly 1,800 newspapers closed between 2004 and 2018, leaving 200 counties in the U.S. without a paper and roughly half the counties in the country with only one, according to a University of North Carolina study. That has stoked concerns that a crucial source of reporting around the country is being starved.

These trends have sparked consolidation and prompted financial investors to hunt for bargains as they accumulate empires that can benefit from economies of scale -- derived in large part from layoffs.

GateHouse and Gannett are discussing a cash-and-stock deal in which GateHouse's parent would likely buy Gannett and GateHouse Chairman and Chief Executive Mike Reed would assume the same roles at the enlarged entity, according to the people familiar with the matter.

Gannett has been without a permanent chief executive since May, when former CEO Robert Dickey retired. He had led the company since 2015, after Gannett split its newspaper-publishing business from the company's broadcast-television stations.

Since the split, factors buffeting the industry have eaten away at the company's value. Gannett's shares have lost nearly half their value as the company struggled to develop a strategy to revive its sagging fortunes. Gannett made a failed attempt a few years ago to buy the Chicago Tribune's publisher, now known as Tribune Publishing Co.

It couldn't be learned what the price of a deal with GateHouse might be. Gannett shares closed at $7.90 on Thursday and rose nearly 8% after hours when The Wall Street Journal reported that a deal between the companies might be close. One could be announced in the next few weeks assuming the talks don't fall apart, the people familiar with the matter said.

The Journal reported in May that Gannett had held merger talks with GateHouse, whose parent is the publicly traded New Media Investment Group Inc. Gannett has also held talks about a potential deal with McClatchy Co.

New Media is smaller than Gannett, with a market capitalization of about $550 million compared with Gannett's roughly $900 million value, although it has deep-pocketed backers. New Media is operated by private-equity firm Fortress Investment Group LLC, which is owned by Japanese telecommunications-and-investing giant SoftBank Group Corp.

Gannett has also recently considered a deal with Tribune, but determined a combination with GateHouse would provide more opportunities to cut costs -- ultimately as much as $200 million a year, or roughly twice what a Tribune tie-up could yield, some of the people said. That would be an unusually big number for a deal of this size, likely reflecting GateHouse's belief that a big chunk of overlapping costs are ripe for cutting.

It is likely that a substantial portion of synergies would stem from layoffs, but also from other factors such as consolidating printing presses.

A merger would give Gannett a far wider geographic footprint to sell digital advertising through its USA Today network and help speed the companies' reorientation away from print.

Together, Gannett and GateHouse publish some 265 daily papers.

GateHouse is currently the largest newspaper publisher in the U.S. by titles owned, with 156 dailies and 464 weeklies, most of which are in small markets. It is No. 2 by circulation, behind Gannett, which owns 109 dailies including the Arizona Republic, Milwaukee Journal Sentinel and Indianapolis Star -- in addition to its flagship USA Today.

GateHouse has been on a buying spree recently, spending close to $1 billion in recent years acquiring dozens of small and medium-size papers around the country -- including the Palm Beach Post and the Austin American-Statesman.

Gannett earlier this year rejected a $12-a-share buyout offer from Digital First Media, partly on the grounds that it didn't appear to have credible funding, and later defeated Digital First in a proxy fight for board seats. Digital First's hedge-fund backer had built a 7.5% position in Gannett's stock and argued that the company was being mismanaged and should consider its offer or look for another buyer. The hedge fund, Alden Global Capital LLC, has since cut that stake to 4.2%, according to FactSet.

--Lukas I. Alpert contributed to this article.

Write to Cara Lombardo at cara.lombardo@wsj.com and Dana Cimilluca at dana.cimilluca@wsj.com

Stocks mentioned in the article
ChangeLast1st jan.
ALPHABET 0.85% 1179.21 Delayed Quote.12.85%
CLASSIFIED GROUP HOLDINGS LTD 0.78% 0.13 End-of-day quote.-88.79%
FACEBOOK 0.61% 183.7 Delayed Quote.40.13%
GANNETT CO INC 0.20% 9.85 Delayed Quote.15.47%
NEW MEDIA INVESTMENT GROUP INC 4.04% 8.5 Delayed Quote.-26.53%
SOFTBANK GROUP CORP -1.11% 4897 End-of-day quote.-30.09%
TRIBUNE PUBLISHING CO 1.11% 7.3 Delayed Quote.-35.63%
share with twitter share with LinkedIn share with facebook
share via e-mail
0
Latest news on GANNETT CO INC
08/13GANNETT INVESTOR ALERT BY THE FORMER : Kahn Swick & Foti, LLC Investigates Adequ..
BU
08/08GANNETT : Management's Discussion and Analysis of Financial Condition and Result..
AQ
08/07GANNETT : Issues Statement Regarding Corporate Headquarters Evacuation
BU
08/07USA TODAY NETWORK : 's 2020 Presidential Election Coverage Kicks Into High Gear ..
BU
08/06BRAGAR EAGEL & SQUIRE, P.C. IS INVES : GCI) on Behalf of Gannett Shareholders an..
PR
08/06WeissLaw LLP Investigates Gannett Co. Inc.
PR
08/06NEWS HIGHLIGHTS : Top Company News of the Day
DJ
08/06NEWS HIGHLIGHTS : Top Company News of the Day
DJ
08/06NEWS HIGHLIGHTS : Top Company News of the Day
DJ
08/06GANNETT CO., INC. : Entry into a Material Definitive Agreement, Change in Direct..
AQ
More news
Financials (USD)
Sales 2019 2 718 M
EBIT 2019 139 M
Net income 2019 47,1 M
Debt 2019 80,6 M
Yield 2019 6,50%
P/E ratio 2019 21,6x
P/E ratio 2020 16,4x
EV / Sales2019 0,45x
EV / Sales2020 0,48x
Capitalization 1 129 M
Chart GANNETT CO INC
Duration : Period :
Gannett Co Inc Technical Analysis Chart | MarketScreener
Full-screen chart
Technical analysis trends GANNETT CO INC
Short TermMid-TermLong Term
TrendsBullishNeutralNeutral
Income Statement Evolution
Consensus
Sell
Buy
Mean consensus HOLD
Number of Analysts 4
Average target price 12,00  $
Last Close Price 9,85  $
Spread / Highest target 52,3%
Spread / Average Target 21,8%
Spread / Lowest Target 1,52%
EPS Revisions
Managers
NameTitle
Robert John Dickey President, Chief Executive Officer & Director
John Jeffry Louis Chairman
Alison Kaye Engel Chief Financial Officer, Treasurer & Senior VP
Jamshid Khazenie Chief Technology Officer
John E. Cody Independent Director
Sector and Competitors
1st jan.Capitalization (M$)
GANNETT CO INC15.47%1 127
WOLTERS KLUWER (ADR)--.--%19 202
INFORMA PLC34.12%12 623
PEARSON PLC-13.21%7 602
AXEL SPRINGER27.28%7 506
SCHIBSTED9.32%6 315