Scripps putting Rocky Mountain News up for sale
December 4, 2008
DENVER ” The Rocky Mountain News, Colorado’s oldest newspaper, was offered for sale on Thursday after owner E.W. Scripps Co. said it lost about $11 million on the operation in the first nine months of the year.
Cincinnati-based Scripps said in a news release that if no acceptable offers emerge by mid-January, it will “examine its other options.” It gave no details.
Scripps has owned the News since 1926. Since 2001, the newspaper has been in a joint operating agreement with The Denver Post, owned by Denver-based MediaNews Group Inc.
Rich Boehne, president and CEO of Scripps, said the company’s 50 percent share of the joint operating agreement cash flow “is no longer enough to support the Rocky, leaving us with no choice but to seek an exit.”
Scripps said the joint operating agreement, known as the Denver Newspaper Agency, has about $130 million in long-term debt from a recently completed consolidation of production facilities with new printing presses and other upgraded equipment.
“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,” Boehne said.
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The News was founded in 1859, and Scripps’ announcement that the property is for sale came amid a series marking the paper’s upcoming 150th anniversary. The News has 232 editorial employees, according to Lee Rose, corporate communications manager with Scripps.
The 2001 joint operating agreement ended a long and heated newspaper war with The Post. The News said its daily circulation reached more than 400,000 in the final years of the battle.
Circulation is currently 210,000 daily and 457,000 on Saturday.
The News publishes Monday through Saturday and The Post publishes Sunday through Friday.
The News joins a crowded marketplace. Cox Enterprises Inc. is trying to sell its newspapers in Texas, North Carolina and Colorado. Landmark Communications Inc. said in January it wanted to sell nine daily newspapers but has found that buyers are having trouble getting loans amid the credit crisis.
“It’s a very bad time to sell newspapers, especially those in large cities,” industry analyst John Morton said. Advertising revenues have been falling with competition from online classified ad sites like Craigslist and weakness in real estate, the job market and the auto industry.
“There are a lot of newspapers for sale and nobody leaping forward to buy them as of yet,” Morton said. “It speaks both to the uncertainty of the future and, of those that have received offers, they were so low the sellers didn’t want to accept them.”
Scripps operates newspapers in 15 markets and has 10 TV stations. It also operates United Media, which distributes the Peanuts and Dilbert comic strips and 150 other features.
Scripps shares were down 3 cents to $2.30 in afternoon trading.