Could Red Sox/Boston Globe owner John Henry buy the Projo?

December 4th, 2013 at 2:52 pm by under Nesi's Notes, On the Main Site

The big news in Rhode Island Wednesday is, of course, that A.H. Belo is putting the Projo up for sale.

The decision won’t surprise veteran Journal-watchers, particularly after Belo’s recent move to shed one of its other two papers – The Press-Enterprise of Riverside, Calif. – for just $27.3 million. It didn’t make much sense for a Dallas-based company that now owns only two big newspapers to have one of them be in its hometown and the other, much smaller one halfway across the country.

Back in 2010, I published a WPRI.com feature story about how much The Journal might fetch these days. On Wednesday I asked two top media analysts to weigh in about the question now, and here’s what they told me, from my updated WPRI.com story:

“I’m not surprised,” Ken Doctor, a media analyst at the research firm Outsell and the author of “Newsonomics,” told WPRI.com. “It’s clear that A.H. Belo is circling the wagons around its home base, Dallas. The Morning News has outperformed Projo and Riverside and has always been a more dominant player there.” …

Employees were told the sale process is likely to stretch into the middle of 2014 and perhaps longer, according to John Hill, president of the Providence Newspaper Guild union, which represents about 160 Journal workers. Stephens will put together a book to show potential buyers what a transaction would entail. …

Doctor said he expects The Journal to sell for a low price just as The Press-Enterprise did. He estimated the Providence paper’s annual earnings before interest, taxes, depreciation and amortization at roughly $12 million a year, and said it’s possible A.H. Belo will try to sell The Journal’s real estate separately.

Without the real estate included, The Journal would likely sell for between $28 million to $45 million, Doctor said.

Rick Edmonds, media business analyst at the nonprofit Poynter Institute in Florida, echoed Doctor’s analysis and said A.H. Belo may succeed in finding a new owner. “Typically properties put up for sale [right now] are finding buyers, though often the price is very low,” Edmonds told WPRI.com.

“In evaluating a sale price, it is important to find out what the building, and other assets are worth and who gets them, typically the buyer,” he said. “Same with pension liabilities, which typically stay with the seller.” …

“I don’t think there is a waiting buyer, but [rather] that the offer is meant to flush out local buyer(s), who sense a turnaround potential and a civic investment,” Doctor said. However, he added, “Philly’s experience there is cautionary, with a revolving door of often-squabbling ‘civic owners,’” a reference to the troubled local ownership group that bought The Philadelphia Inquirer in 2012. …

Boston Red Sox owner John Henry paid $70 million to buy The Boston Globe in August. … Henry is now looking to sell the Worcester Telegram & Gazette, which he acquired as part of the Globe purchase. …

Doctor said Henry “probably isn’t interested” in purchasing The Journal considering his decision to sell the Telegram & Gazette and focus on The Globe, “though there would be some synergies (newspaper and baseball) in combining some operations.”

“He may be asking his people to run some numbers,” Doctor added. Through a spokesman, Henry declined to comment.

• Related: Dallas-based A.H. Belo puts The Providence Journal up for sale (Dec. 4)

This post has been updated with Doctor’s revised estimates.

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2 Responses to “Could Red Sox/Boston Globe owner John Henry buy the Projo?”

  1. Bob says:

    shakes his couch hard enough, probably have enough.

  2. [...] is up for sale, there’s a lot of people trying to suss out who will be the new owner, with famous rich people being thrown out as [...]