GateHouse parent New Media Investment Group has completed its $1.2 billion cash-and-stock buy of Gannett, the companies announced Nov. 19. The combined company has adopted the name Gannett Co. and trades on the New York Stock Exchange under the ticker GCI.
The combined company is the largest local news organization in the U.S. with 260 daily newspapers plus USA Today. In the U.K., its Newsquest division has more than 150 local media brands and a network of websites. Twenty-five percent of its revenue is driven by digital products sold across company brands, which include ThriveHive, ReachLocal, Wordstream and sweetIQ. The company also owns and operates the largest high school athlete recognition program in the U.S. and is the second-largest producer of endurance events in North America.
The merged operation is headquartered in Mclean, Virginia, where Gannett has been based.
Gannett is externally managed and advised by an affiliate of Fortress Investment Group, a global investment management firm. This management agreement will be sunset at the end of 2021 as a condition of the merger.
The company has indicated it aims to cut $300 million in annual costs post-merger.
“Our powerful network of brands and capabilities position us well to ensure and preserve the future of local journalism,” read a Gannett statement on the merger.
Not all reactions were so positive.
“The future for local news looks bleak,” read a headline on a post-merger piece by Michael Hiltzik, business columnist at the LA Times.
“The deal is bad for journalists, it’s bad for readers and it’s bad for the future of local journalism,” said NewsGuild-CWA President Bernie Lunzer in a statement from the union, which represents employees at numerous of the company’s newsrooms. “Local papers will likely vanish, jobs will be slashed, and reporting will suffer.”
Voluntary buyouts reportedly representing three to five positions were announced at Gannett’s Milwaukee Journal Sentinel, the Milwaukee Business Journal reported.
Of the 200 dailies at the newly merged company that file print circulation numbers publicly, more than 80 percent are losing circulation at a faster clip than the national average and 10 percent are falling at twice that rate or more, according to a Business Journal examination of the numbers.