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Weekly UpdatesFinally gaining some traction in its attempt to skew its business away from print advertising, Cox Enterprises on Thursday said it had found a buyer for two of its Texas dailies. Earlier in the week, the company said it had sold its North Carolina coupon and direct marketing firm, while on Friday it said that it had completed the acquisition of all the shares in Cox Radio it didn't already own.
Last August the Atlanta-based Cox said it was putting its papers in Texas, Colorado and North Carolina up for sale, while retaining its flagship Atlanta Journal-Constitution, its founding paper, Ohio's Dayton Daily News and Florida's Palm Beach Post.
Buyers of dailies have been few and far between in the ensuing nine months, but Southern Newspapers Inc. of Houston and Cox came to agreement on Cox's two smaller Texas dailies, the Lufkin Daily News and the Daily Sentinel of Nacogdoches.
No terms for the papers were revealed; Dirks, Van Essen & Murray, the Santa Fe, N.M. newspaper broker, represented Cox.
The Lufkin paper has a circulation of about 16,000, while the Nacogdoches operation sells about 10,000 papers a day. Cox has centralized some back office functions between the two papers. The deal was finalized over the weekend.
Southern now has 16 dailies in the Gulf Coast region, including its flagship Galveston County Daily News in Texas, which has a circulation of about 33,000.
Cox's other Texas paper, the Austin American-Statesman, remains for sale. Reuters reported on Thursday that a potential buyer for the 152,691-circulation Austin paper, private equity firm ZelnickMedia Corp., had dropped out of the hunt. Quoting "a person familiar with the matter," the wire service said Zelnick had "soured" both on the Austin market and on newspapers in general.
The wire service said that Cox has been seeking about $200 million for its Austin operations, which include the web site Austin360.com. In addition to the Austin assets, Cox said it continues to seek buyers for its North Carolina and Colorado operations.
Earlier in the week the company did liquidate its Saving Source Direct division, based in Tarboro, N.C. Formerly known as PAGAS Mailing Services, Saving Source Direct "is the local source for value-oriented content and coupons in more than 100 markets throughout North Carolina."
The buyer is MailSouth of Helena, Ala. No terms for this deal were revealed either and Dirks, Van Essen, again represented Cox.
The Atlanta-based company also said on Thursday that it had completed its takeover of Cox Radio Inc., which had been a publicly traded business that was majority-owned and controlled by Cox. The company launched the takeover in March at $3.80 a share but eventually had to increase the offer to $4.80 a share. At that price, the deal for the 22 percent of the company that Cox didn't already own is valued at $83-1/2 million.
In other mergers and acquisitions news, Blethen Maine Newspapers took one more step in its long march to sell its Portland Press Herald/Main Sunday Telegram, the Kennebec Journal and the Morning Sentinel in Waterville. On Friday, the company's unions agreed to large layoffs and other takebacks in return for gaining a 15-percent ownership stake in papers and two seats on the board of directors.
The buyer is the private equity firm HM Capital Partners LLC, working in concert with Richard Connor, the publisher of the Times Leader in Wilkes-Barre, Pa., operating under the name MainToday Media Inc.
HM Capital helped Connor buy the Times Leader in 2006 from The McClatchy Co., when the Sacramento-based publisher was jettisoning some of the assets it acquired when it took over Knight Ridder.
Blethen Maine is a division of The Seattle Times Co., which put the papers up for sale almost a year ago.
Lastly in M&A news, E Ink Corp. of Cambridge, Mass., said today that it was being acquired by its manufacturing partner, Prime View International of Taiwan. E Ink, which makes the technology behind the Amazon Kindle and Sony Reader e-books, has included a number of publishing companies as investors, including The Hearst Corp. and early on, McClatchy and Central Newspapers, whose stake in the company passed to Gannett Co. Inc.
The deal was valued at $215 million.
It will be interesting to see just how low Cox will be willing to go to sell the Austin and Colorado operations (my guess is that buyers for the multitude of small North Carolina dailies won't be as hard to find). Also, the Reuters story on Austin cited the desire to pay down debt as a rationale for these sales; I hadn't read that anywhere else before. I didn't think Cox had any appreciable debt (but I've been wrong before).
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