Pulitzer Publishing Expands Its Base p. 21

By: Mark fitzgerald PULITZER PUBLISHING CO., owner of just three daily newspapers located in St. Louis and Tucson, Ariz., said May 6, that it is buying the stock of Scripps League Newspapers, the privately owned chain that publishes 16 small- and medium-circulation daily papers and numerous nondailies in the Northeast, Midwest and West.
Pulitzer said the agreement gives Charlottesville, Va.-based Scripps League the option of excluding from the sale three of the smaller daily newspapers and two nondailies. Depending on the number of papers purchased, Pulitzer said, the transaction's total price will range from $230 million to $240 million, including approximately $25 million in working capital.
Pulitzer said the purchase will be funded by a combination of cash and borrowings from banks and an institutional lender.
The transaction, Pulitzer added, is subject to "various closing conditions."
Pulitzer chairman, president and chief executive officer Michael E. Pulitzer said the Scripps League purchase "meets our key acquisition criteria: strong cash flows, good markets that enhance geographic diversification, and opportunities for future growth. We expect that the acquisition will add to Pulitzer's consolidated after-tax cash flow in 1996."
Geographically, the markets served by Scripps League Newspapers complement markets where Pulitzer has a paper or broadcast outlet, said Nicholas G. Penniman IV, Pulitzer's senior vice president/newspaper operations and publisher of the chain's flagship St. Louis Post-Dispatch.
"If you lay the Scripps League map on top of the Pulitzer map, you'll see it really fits very well," Penniman said. "We like the geographic diversity."
In addition to its big-city papers in Missouri and Arizona, Pulitzer owns nine television stations in the South, Midwest and Southwest. Buying Scripps League gives Pulitzer access to new markets such as New England and the northern Midwest, Penniman said.
The acquisitions will also give Pulitzer groupings similar to the regional marketing strategies adopted recently by chains such as Thomson Newspapers and Hollinger International, he added.
"In California, Scripps League has a regional group and in some of the markets [involved in the purchase], there are other owners who might be willing to sell, down the road," Penniman said.
Scripps League's vice president/ finance, Thomas E. Wendel, said in a telephone interview that the company is not commenting on the transaction.
He added Scripps League has "no problem" with the content of Pulitzer's announcement.
Five of the 16 Scripps League dai- lies in the transaction account for approximately 60% of its revenues and two-thirds of its operating cash flow, Pulitzer said. The five are the 32,500-circulation Provo,
Announces agreement to buy the 16 daily newspaper Scripps League chain for $240 million Pulitzer chairman, president and chief executive officer Michael E. Pulitzer said the Scripps League purchase
?(Pulitzer chairman, president and chief executive officer Michael E. Pulitzer said the Scripps League purchase "meets our key acquisition criteria: strong cash flows, good markets that enhance geographic diversification, and opportunities for future growth. We expect that the acquisition will add to Pulitzer's consolidated after-tax cash flow in 1996."