For some months now potential asset sales have been discussed by top management of Media General in Wall Street conference calls – most recently last month. Now the TV/print/Internet company has announced that it is in serious negotiations to sell some newspapers.
Here is the statement released Wednesday (2/22) after the stock market closed:
“Media General, Inc. (NYSE: MEG) today announced that it is exploring the potential sale of newspaper operations. Media General said it has received inquiries from several third parties regarding the potential purchase of certain of its print assets. The company wishes to ensure that any divestiture it may make maximizes shareholder value.
Media General has indicated in recent months that it will consider asset sales at valuations that reflect the strength of its properties as a means of reducing total debt outstanding over time. The company noted that the valuations of local media properties in recent merger and acquisition transactions, including local newspapers, have reflected the strong market positions of the entities being sold. Media General’s newspaper brands are the leading print products in their core markets.
The company said there can be no assurance that any transaction will take place. Media General provided no definitive timetable for the evaluation process to conclude. Additional information will be provided if and when the company enters into a transaction. The investment banking advisory firm Peter J. Solomon Company is assisting Media General with the strategic evaluation process.”
RBR-TVBR observation: What’s most amazing is that there are people out there willing to sink real cash into newspapers. The New York Times Co. got $143 million for its 15 regional papers in a deal backed by venture capital.