1st Quarter 2011
MediaNews grows in Colorado
Established and new firms close three deals in Colorado to drive first quarter activity
Colorado was the center of the newspaper deal universe in the first quarter.
Transaction activity through March 31 was highlighted by the sale of three daily newspapers, several weekly newspapers and business publications – all in Colorado and principally in the northern portion of the state.'
In the largest sale, MediaNews Group acquired family-owned Lehman Communications, which operated three daily newspapers and a weekly newspaper group in Colorado. In addition, a newly formed company bought a collection of business publications serving northern Colorado and southern Wyoming markets. And a separate new company entered the suburban Denver market with the acquisition of a locally owned operation.
Dirks, Van Essen & Murray continues to expect the pace of newspaper transaction volume to improve as the year progresses.
Home on the Front Range
The Lehman family finalized a deal in the first quarter to sell their three Colorado daily newspapers and associated weeklies to a subsidiary of Denver-based MediaNews Group. The group owned by Lehman Communications included two neighboring dailies in northern Colorado – the 20,000-circulation Longmont Times-Call and 16,000-circulation Loveland Reporter-Herald – as well as complementary weekly newspapers serving the communities of Louisville, Lafayette and Erie.
In addition, the Lehmans owned the 6,300-circulation daily Cañon City Record, south of Denver.
The acquisition represents an expansion of MediaNews’ already significant presence in northern Colorado, which includes the Denver Post, the Boulder Camera, the Colorado Daily in Boulder, dailies in Fort Morgan and Sterling and a number of non-dailies in Estes Park and other communities (see map below).
Denver attorneys Ed and Ruth Lehman bought the Longmont newspaper in 1957 from local owners. Ed Lehman still held the title of publisher at the time of the sale to MediaNews and remains editor emeritus under the new ownership. His son, Dean Lehman, also is remaining with the newspaper operation under MediaNews.
The Lehmans added the Loveland paper in 1967, and the Cañon City operation in 1978. The weekly newspapers serving the communities to the south of Longmont were acquired in 1997. Lehman Communications opened a new production facility in 2009 that MediaNews plans to utilize in its northern Colorado cluster.
Same Place, Different Newspapers
Also in northern Colorado, newly formed BizWest Media acquired three business publications and controlling interest in a company that provides research tools for business journals.
The publications include the Boulder County Business Report, the Northern Colorado Business Report and the Wyoming Business Report, in addition to a number of magazines, directories and other publications. The research company, DataJoe, provides research, publishing and e-commerce software for the business journal industry. The two principals in BizWest, Chris Wood and Jeff Nuttall, were part-owners and managers of the publications prior to the transaction.
The deal was the last in a series of divestitures of business publications formerly owned by Brown Publishing Co.
Ohio Community Media took ownership of these and other publishing assets through a court-ordered bankruptcy sale of the Brown Publishing assets in the fall 2010. OCM continues to own a group of community newspapers in western and northern Ohio formerly owned by Brown.
You’ve Got News
In a major content play, AOL paid $315 million for the Huffington Post, the online newspaper launched in 2005. The Huffington Post is one of the top online news sites, and the acquisition will help AOL expand its ability to generate original content. AOL also is expanding Patch, a local news operation with original content generated largely by stringers; and Seed, which uses citizen journalists.
Arianna Huffington, the founder of the Huffington Post, is taking over AOL’s editorial content and new operations. Executives at the Huffington Post have said that 2010 was the newspaper’s first profitable year and that revenue is expected to grow from $31 million in 2010 to $60 million this year.
Although much of the Huffington Post’s news content is aggregated from other sources, it has begun to invest more in its own reporting.
In making the announcement about the acquisition, AOL chief Tim Armstrong said we are “big believers in the future of content.”
The locally owned Aurora (CO) Sentinel and associated print and online publications was sold to a newly formed company headed by James Gold, a former senior vice president at the New York Times Co. The transaction also includes the non-daily Buckley Guardian, which serves a local Air Force Base and other military personnel. The former owner, Harrison Cochran, had acquired the Sentinel in 1991. It had once been part of a group owned by the Minneapolis Star Tribune, among the numerous local and corporate owners in the past.
Gold is the managing partner of Leap Media Partners. He had formerly run the New York Times regional publishing group.
Aurora is a large exurban community east of Denver that includes Buckley Air Force Base and a sprawling Army medical and research complex.
John Buzzetta’s Van Zandt Newspapers acquired the Shopper’s Edge in Paris, Texas from a local owner. Van Zandt Newspapers publishes nine weekly newspapers in east Texas, including the Van Zandt News.