Rocky Mountain News put up for sale
It's the sort of headline most media observers in this area have been anticipating for quite some time, but it's still a shock to see it in print: "Rocky Mountain News For Sale."
The article, published moments ago on the Rocky's website, quotes from a press release in which Rich Boehne, president and CEO of E.W. Scripps, the paper's parent company, is quoted as saying, "The decision to seek a buyer for the Rocky would have been unthinkable until very recently. But the operating conditions have become increasingly difficult in Denver, as is the case in all major metropolitan newspaper markets. Our 50 percent of the cash flow generated by the Denver Newspaper Agency is no longer enough to support the Rocky, leaving us with no choice but to seek an exit."
Those last words ring eerily, don't they?
There'll be plenty of fallout from this move, to be sure, and much more to be written. But here are the first questions that occur to me regarding the Rocky going on the block: Who in their right mind would buy a major metropolitan newspaper in this business climate? Could a corporation outside Colorado be coaxed into doing so? Or is the only hope a local moneybags who might purchase it in part for civic reasons? (Betcha Phil Anchutz's phone is ringing off the hook right now.) And if a buyer is found, will that individual or entity be yoked to the current joint operating agreement? Or will he/she/it be able to revise? Also, what's Denver Post publisher and MediaNews Group head honcho Dean Singleton think about this? Would he like to pair up with a new partner? Or would he rather the whole enterprise collapse, so he can have the town to himself at last?
Answers -- or reasonable facsimiles thereof -- will be trickling in over the coming days and weeks. In the meantime, the folks at the Rocky are in shock over the announcement, which was made in the newsroom by visiting Scripps types as the article hit the net. Looks to be a very nervous holiday season for folks at the tabloid, which is celebrating its 150th anniversary this year. No doubt everyone's wondering: Will it make it to 151?
Click "More" to read the complete Scripps press release. -- Michael Roberts
Scripps to seek buyer for Rocky Mountain News
50 percent interest in Denver Newspaper Agency also for sale
For immediate release (NYSE: SSP)
December 4, 2008
CINCINNATI - The E. W. Scripps Company has decided to offer for sale its Denver-based daily newspaper, The Rocky Mountain News, as well as the newspaper's 50-percent interest in the Denver Newspaper Agency, which publishes the Rocky Mountain News and The Denver Post under a joint operating agreement (JOA).
Scripps bought the Rocky Mountain News, which is Colorado's first newspaper and the state's oldest continuously operated business, in 1926. After a decades-long circulation war, the newspaper in 2001 entered into the JOA with The Denver Post, which is owned by MediaNews Group.
The Denver Newspaper Agency manages the business and production operations of the Rocky Mountain News and The Denver Post. Through subsidiaries, Scripps and MediaNews Group each have a 50-percent stake in DNA but maintain separate and independent editorial operations.
"The decision to seek a buyer for The Rocky would have been unthinkable until very recently," said Rich Boehne, president and chief executive officer of Scripps, "but the operating conditions have become increasingly difficult in Denver, as is the case in all major metropolitan newspaper markets. Our 50 percent share of the cash flow generated by the Denver Newspaper Agency is no longer enough to support The Rocky, leaving us with no choice but to seek an exit."
The Scripps paper's share of the operating income (accounted for as "equity earnings") from the Denver Newspaper Agency fell more than 50 percent to $5 million in the first nine months of 2008 (excluding the one-time gain of $4.4 million from the sale of property). Rocky Mountain News editorial expenses in the same period approached $16 million.
In addition to the challenge of funding the two daily newspapers, the Denver Newspaper Agency also has approximately $130 million in long-term debt resulting from a recently completed consolidation of production facilities.
Scripps is working with New York-based Broadwater & Associates in the search for a buyer. The company intends to entertain offers through mid-January 2009. If no acceptable offers emerge in the course of that period, the company will examine its other options for the future of the Rocky Mountain News and its interest in the Denver Newspaper Agency.
"Some will be tempted to immediately write the obituary of The Rocky, but we're hoping this step will open the way for a creative solution to the financial challenges faced by Denver's great newspapers," said Boehne. "The loyal readers and advertisers of Denver deserve the very best and we'll work hard to find a solution that benefits this great city."
Scripps will continue to support The Rocky financially while a buyer is being sought. No changes are anticipated in the daily paper or its digital service, rockymountainnews.com.
Prairie Mountain Publishing, another partnership between Scripps and MediaNews Group entities involving newspapers elsewhere in Colorado, and YourHub.com, a print and online initiative of the Denver Newspaper Agency providing hyperlocal news content for communities in Colorado and elsewhere, are unaffected by today's announcement.
The E.W. Scripps Company is a diverse, 130-year-old media enterprise with interests in television stations, newspapers, local news and information web sites, and licensing and syndication. The company's portfolio of locally focused media properties includes: 10 TV stations (six ABC affiliates, three NBC affiliates and one independent); daily and community newspapers in 15 markets and the Washington, D.C.-based Scripps Media Center, home of the Scripps Howard News Service; and United Media, the licensor and syndicator of Peanuts, Dilbert and approximately 150 other features and comics. For a full listing of Scripps media companies and their associated Web sites, visit www.scripps.com.
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