By: Staff reports $2.6-Billion Deal Increases Flagship Appeal
The newspaper industry's largest conglomerate is about to get a bit
bigger. Gannett Co. Inc. announced late Wednesday it will acquire
Central Newspapers Inc., owner of The Arizona Republic, The
Indianapolis Star, and four other daily newspapers for $2.6
billion.
As part of the deal, a Gannett subsidiary will make a tender offer for
all Central class A and H stock at $64 and $6.40 per share,
respectively. Gannett will also assume or retire all Central debt. The
transaction has been approved by the boards of Gannett, Central, and
the Eugene C. Pulliam Trust, which controls 78% of Central.
The purchase increases Gannett's stature in the newspaper biz by
significantly increasing circulation numbers and adding to its flagship
list. If the deal is completed, the Republic will become the
second largest title in the Gannett chain, behind only USA
Today. The Star would become the third largest, edging out
Gannett's Detroit News.
Gannett President and CEO Douglas H. McCorkindale said Gannett looks
forward to running Central Newspapers 'with the high standards
established by the Pulliam family.'
Central Chairman, President, and CEO Louis A. Weil III said in a
statement: 'It is increasingly clear that size and scale are key
considerations in the long-term success of a newspaper operator ... and
we believe that Gannett, with its strong operating capability and its
enormous commitment to newspapers, will continue to enhance the value
of Central's businesses.' Those businesses include a direct marketing
business and CNI Ventures, the company's technology investment group.
The purchase follows a spending spree for Arlington, Va.-based Gannett,
which recently purchased a chunk of the Thomson Newspapers chain and
the U.K.'s Newscom group. Gannett picked up 21 Thomson titles for about
$1.13 billion. The Thomson purchase put the company just over the 7-
million daily circulation mark in the U.S.
Phoenix-based Central announced earlier this month that it was
exploring sale and merger options. Its share price soared 65% June 8
when the news was announced.
Here are the latest circulation figures for Central's papers:
The Arizona Republic, Phoenix (482,003) ABC March 31
The Indianapolis Star (243,133) ABC March 31 (Five-day average)
Alexandria (La.) Daily Town Talk (36,202) ABC March 31
The Star Press, Muncie, Ind. (34,259) ABC March 31
Vincennes (Ind.) Sun-Commercial (12,341) ABC March 31
Daily Ledger, Noblesville, Ind. (11,956) CAC Oct. 31, 1998
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Staff reports
Related stories:
THOMSON SALE RESHAPES GANNETT, CNHI GROUPS (06/13/00
CENTRAL NEWSPAPERS EXPLORES SALE, MERGER (06/08/00)
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