Posted on 03/18/2008 3:52:04 AM PDT by paul in cape
The Blethen family makes the 'painful decision' after a decade of ownership.
The Seattle Times Co., parent company of the Portland Press Herald/Maine Sunday Telegram, is putting its Maine media properties up for sale.
Charles C. Cochrane, president and chief executive officer of Blethen Maine Newspapers, said the decision is based on The Seattle Times' need to focus on operating its newspapers in Washington state.
"The decision to explore a sale was painful," Cochrane said, "but a sale might be the best opportunity for the long-term survival of our newspapers in Washington and those in Maine."
The Seattle Times Co., which is owned by the Blethen family, bought the newspapers from Guy Gannett Communications in 1998. In addition to the Portland newspapers, Blethen Maine owns the Kennebec Journal in Augusta; the Morning Sentinel in Waterville; the Coastal Journal, a free weekly in Bath; The Maine Switch, a free weekly in Portland; and MaineToday.com, the company's online site.
Blethen Maine Newspapers has 509 full-time employees and 189 part-timers. It is Maine's largest newspaper group.
Cochrane said Blethen Maine Newspapers is making money and has been profitable every year since The Seattle Times purchased the papers, except for a loss last year related to an impairment charge -- a write-down of the value of intangible assets such as goodwill and brand value.
"Certainly, the profits have been less" in recent years, Cochrane said, a trend experienced by most of the country's newspapers as readers migrate to online sites, where they can find newspaper stories for free and where advertising is less lucrative. The loss of classified ads to online sites such as Craigslist also has hit papers hard, he noted.
The company last week said it was cutting 27 jobs, resulting in the layoff of 15 employees at the Portland Press Herald/Maine Sunday Telegram.
The Blethen family "has held off from selling anything while they hoped for a turnaround," Cochrane said. "It's now become clear that's not going to happen anytime soon."
The loss of revenue has depressed the value of newspapers and makes the family's decision to sell now "a little surprising," said John Morton, a newspaper analyst based in Maryland.
"I think we all know that they're struggling in Seattle. Business has not been good for large metropolitan newspapers in the last year, and I'm sure they haven't escaped that," Morton said. "It just comes down to where they need the money."
The Seattle Times is privately held and has never disclosed what it paid for the Maine newspapers, but Morton previously had estimated the price at $200 million.
Given the state of newspapers in 1998 -- near a high-water mark for values -- and now, the Blethens will be "lucky if they get half of what they paid for it," he said Monday.
Morton said the universe of potential buyers also is smaller now than it was a decade ago, which could keep the price down. Some of the country's larger chains, such as McClatchy Co. and Gannett Co. -- no relation to Guy Gannett Communications -- aren't in much of a position to buy. McClatchy recently posted a loss of more than $1.4 billion for 2007, and Gannett's earnings were down from a year ago.
"This is not a great time to sell a newspaper," Morton said.
Frank Blethen, president and chief executive officer of The Seattle Times, agreed.
"We did pay top dollar for them (the Maine newspapers)" in 1998, he said, and getting half that price "would be a reasonable assumption."
The company's broker, Dirks, Van Essen & Murray, "feels there's quite a few buyers out there," Blethen said, but his "dream" would be for a group of community investors to come forward to buy the papers.
"The workers here are stunned by the news," said Tom Bell, vice president of the Portland Newspaper Guild. "We are optimistic that a buyer can be found who can help us continue to serve our readers and also help us grow our online operations."
said his family felt a strong tug when the Gannett family put the papers on the market a decade ago.
He said the family had made a series of "pilgrimages" to the state in the mid-1990s after learning that Alden Blethen -- Frank Blethen's great-grandfather, who bought The Seattle Times in 1896 -- was born and grew up in Maine.
He said the two papers in central Maine circulate in the area where Alden Blethen grew up, and Portland is where he practiced law as a young man.
One of Alden Blethen's law offices was on Exchange Street, just down the street from the newspaper building.
"That had some real special emotional pull," Blethen said. "It's sort of like you've got this ghost of Alden rumbling around this place."
But, he said, The Seattle Times in recent years has dealt with a costly employee strike; the dot-com collapse in 2001; huge job cuts at Seattle-based Boeing, the aircraft manufacturer, after Sept. 11; and a four-year legal battle with the Hearst Co. about a joint operating agreement with the Seattle Post-Intelligencer. The company also owns newspapers in Yakima and Walla Walla, Wash.
The company has sold $30 million worth of real estate in downtown Seattle to reduce its debt, but still is struggling financially, Blethen said.
Selling the Maine papers will allow the company to reduce or eliminate its debt, he said.
"It puts us in a position that we can avoid the level of disinvestment that really erodes the value and you start to wonder if you can ever recover from it," he said. The family and company never aspired to be a large chain, he added.
"We really don't want a whole bunch of newspapers," he said. "They're kind of like kids: Once you have to give them numbers you've got too many."
Not sorry to see them go.
1. "a writedown of goodwill..." means that they have already rrecognized that it is worth a lot less than they paid for it, something a sale will confirm..
2. "it's been profitable every year..." let's see, now.. I bought something for say $200 mill, it has revenues, say of $10 mill a year, and expenses of $9 mill a year..therefore it's "profitable by $1 mill a year, except for that nasty little factoid that it's worth about HALF of what I paid for it..
“buy high, sell low”-who says you have to be smart to be rich.
“This is not a great time to sell a newspaper,”
Another example how liberals can’t run any business successfully.
Here they bought at a high price and will be lucky to get 50% of what they paid during their going out of business sale.
This left wing excuse of a newspaper has used the Dixie Chick marketing strategy for a long time. That is to po at least 50% of its subscribers and advertisers with its left wing bs posing as news.
Now its plucked and worthless chickes are coming home to roost.
Jim Cramer would probably advise the nuts who listen to his rants to buy high again.
He is a communist/collectivist/socialist - whatever name one wishes to assign to him. BUT, give him credit for putting huge amounts of money at risk to push his beliefs. Those papers DID sway public opinion.
Huge amounts of land were acquired by goobers in an array of gooberment agencies because of those papers support of such land condemnations.
Where on the conservative side have there been any people willing to put out any significant amount of money for conservative beliefs.
The communists/socialists deserve their present dominance of the agencies and the public schools because they devoted two or actually three generations (and G*d only knows how much money to achieve their goals.
Who on the conservative side has done any thing similar?
Other than FreeRepublic and Heritage Foundation?
Ping.
They were lucky to find a buyer at any price.
Cramer may want to look for a new line of work.
.
“Cramer may want to look for a new line of work.”
No!
We want Cramer to stay where he is and keep on telling his liberal cult investors to invest in losers.
The more money elite liberals lose, the less money and power they have to buy elections.
Good thing those liberals did not dump it at $65...
now worth $2...?
Time for a late term abortion? That's OK with me, Mr. Blethen, as long as it's just newspapers you're talkin' about. I understand where you're comin' from.
Looking at news clips of Cramer whining about his pal Elior Spitzer it became clearer why Cramer was never nailed for his various dealings.
Spitzer only went after people he hated. Spitzer’s friends got off scot-free.
Now that Spitzer’s bit the dust, we should expect the feds to act.
Hopefully the feds will leave Crazy Cramer alone.
He is a cult leader of the economic dumbed down left wing elite.
If they follow his advise, they will lose vast sums of money and power. Then, they will not have impact on local, state and federal elections.
Along the same line, we should hope that Jerimiah Adolph Wright continues to spew his hatred of America and anyone who isn’t black.
I’m sure every sales-tax-free business which sells on eBay will be glad to advertise in those papers in Maine.
In a frightening nightmare I found myself looking at a mirrored ceiling stark naked, and discovered that I am a Negro who is circumcised. I felt depressed, downcast, sitting in a chair-—a wheelchair. That meant besides being Black and Jewish, I’m also disabled. I said aloud ‘This is impossible.”
” No senor, it eesn’t,” whispers someone from behind me. I turn around to see my Mexican boyfriend.....so.....I am a Black homosexual, Jewish, disabled, gay, with an illegal boyfriend, a drug problem, and HIV-positive. I tried to pull out my hair but find I’m bald.
The telephone rings. It’s my brother: “Since mom and dad died the only thing you do is hang out, take drugs, and laze around all day. Get a job you worthless piece of crap. Now I fimd I’m an unemployed orphan. I try to explain to my brother how hard it is to find a job when you are Black, Jewish, disabled, gay with a Mexican boyfriend, and a drug addict, HIV positive, bald, and orphaned. But he doesn’t get it. I hang up. It’s then I realize I only have one hand.
With tears in my eyes look out the window. I live in a shanty-town of cardboard and tin houses. There’s trash
everywhere. Suddenly I feel a sharp pain near my pacemaker.... Besides being black, Jewish, disabled, a fairy with an illegal boyfriend, a drug addict, HIV positive, bald, orphaned, unemployed, an invalid with one hand, who lives in a slum, I have a bad heart.
At that moment my boyfriend says to me, “Sweets, my little enchilada, did you decide who are you going to vote for in the Primary? Hillary or Obama?
OMG, I can handle being a Black, disabled, one armed, drug addicted, Jewish queer on a pacemaker who is HIV positive, bald, orphaned, unemployed, lives in a slum, and has an illegal boyfriend..........but please, oh dear God, please don’t tell me I’m a DEMOCRAT....
You should post this in the new thread about NY’s philandeering new governor.
Check this out. I was joking upthread when I said they’ll be lucky to find a buyer at any price. I may have been closer to the truth than I thought.
http://www.crosscut.com/business-technology/12664/A+sentimental+journey+ends/
A sentimental journey ends
In Maine, where the majority-owning Blethen family rediscovered its roots a decade ago, the Seattle Times Co. is selling three prominent dailies — at a nadir for the newspaper business. It’s a bad sign.
snip
And selling off a chain of small papers in a slow-growth market like Maine could be a challenge. “I have no idea who would buy this chain,” said Jeff Inglis, editor of the Portland Phoenix, the city’s alternative weekly. Inglis, who covers the Maine newspaper industry, said rumors that the Seattle Times Co. was getting ready to dump its Maine holdings have been circulating for more than a year as the local chain’s finances have soured. Charles Cochrane, the Maine chain’s president and chief executive, told the Portland Press Herald the chain’s profits have been shrinking in recent years. The Press Herald cut 27 jobs last week and has had an uneasy relationship with its union. Another paper in the chain, the Waterville Morning Sentinel, has had a long-running byline strike by union members over a contract dispute.
snip
A spokesperson for the Seattle Times Co. could not be reached for comment, but the Press Herald quoted Blethen as saying that “a reasonable assumption” would be that the Maine chain would sell for half the price the Seattle Times Co. paid a decade ago.
That might be wishful thinking, given the cash-strapped state of the newspaper industry these days. And whether it would be enough to bail out the struggling Seattle Times Co. mothership isn’t clear. A key item is how much of the Maine debt is left on the Times Co. books after two lender renegotiations and an additional $24 million the company had to borrow last year to pay Hearst in settling a four-year legal squabble over the joint operating agreement.
snip
Crap... You stole my line...
Do you just love ready these how not to run businesses summaries of rat owned businesses.
Light comedy for afternoon reading...thanks a million
Oh Lord! Don't let Cheryl Crow in there with hers!!!
Crow and the DCed chicks are typical of the no brained spokesits for the left.
Hearst could be a potential buyer. They partially owned the Seattle Times. They also have their yellow pages directory, The Talking Phone Book, in Portland and New England. There may be some cross marketing available.
If they can just hold out long enough for the “fairness doctrine” to return, they won’t have to worry...
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