Tuesday, November 21, 2017
Business

Media General considers sale of newspaper operations

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Media General Inc., the parent company of the Tampa Tribune, said Thursday it is exploring the potential sale of newspaper operations.

The Richmond, Va.-based media conglomerate said it has received inquiries from several third parties about buying "certain print assets."

Company spokesman Ray Kozakewicz declined to discuss which of its 23 papers may be sold or disclose any potential buyers.

The company hired banking advisory firm Peter J. Solomon Co. to help weigh its options.

Media General, which also owns WFLA-TV News Channel 8 and TBO.com, has been under pressure to alleviate more than $650 million in debt amid sagging revenues.

Executives warned investors in January that the company is "uncomfortable with its ability to remain in compliance" with the terms of about $360 million in debt that comes due in March 2013. But lenders gave the company some breathing room with a short-term bridge agreement last week.

The company lost $74 million in 2011, with newspapers in particular hurting its bottom line. Revenues for its Florida print operations were down more than 12 percent to $75 million last year.

In December, Media General announced it was cutting 165 staffers at the Tribune and smaller nearby operations in Tampa, a 16 percent reduction.

Shares in Media General tumbled to nearly $1 a share last fall, but have since recovered somewhat. The stock closed Thursday at $5.01 a share.

The potential selloff of newspapers was disclosed after the close of market, spurring a 5 percent boost in after-market trading.

While the Tampa Bay Times is often mentioned as a potential buyer of the Tribune, company chairman and CEO Paul Tash said the Times was not among those who recently contacted Media General.

Nonetheless, "We're always interested in opportunities in the Tampa Bay marketplace," Tash said. "Our priority remains advancing our own success."

Among other potential Tribune buyers is Halifax Media Group, a company that recently bought a chain of papers owned by the New York Times, including the Sarasota Herald Tribune, the Ledger in Lakeland and the Gainesville Sun. Halifax CEO Michael Redding could not be reached for comment late Wednesday.

The Tribune's circulation stands at 254,782 on Sundays and 125,867 during the week, according to the latest industry figures. The Times has Sunday circulation of 403,229 and weekday circulation of 240,024.

Patrick Manteiga, publisher of La Gaceta in Tampa, expressed concern that the Tribune may fold at some point.

"When you have cut so deeply, as they have in their news department, it kind of takes away the only reason to buy the Tribune, which is news," he said. "It looked like the paper was headed down a road of no return."

Hillsborough County Commission Mark Sharpe lamented hard times for any paper, saying that newspapers help keep government honest.

"I never like it when I hear of the potential sale of a newspaper, particularly the Tampa Tribune, which has a long history in our community," he said.

Staff writers Bill Levesque and Bill Varian contributed to this report. Jeff Harrington can be reached at [email protected]

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