Digital First Media strikes newspaper deal with Gannett
Digital First Media, the company that owns The Detroit News, has struck a deal with Gannett to swap ownership interests in an array of newspapers in the San Francisco area and elsewhere in the country, the company said Monday.
The move won’t affect The News or the Detroit Free Press, which is owned by Gannett. It also won’t affect other Digital First holdings in Michigan, including the Macomb Daily, Royal Oak Tribune, Oakland Press, Mount Pleasant Sun, the Heritage newspapers and affiliated weekly publications.
“This new simplified ownership structure has advantages for all parties involved and gives us full ownership of our important California operations,” Steve Rossi, president of Digital First Media, said in an announcement sent to employees.
Those California operations include nearly every daily newspaper in the Bay Area, as well as newspapers in the Los Angeles area and across Northern California.
Digital First Media has exchanged with media company Gannett the entire 59.4 percent stake that DFM had in several newspapers in Texas, New Mexico and Pennsylvania for Gannett’s 19.4 percent stake in the California newspaper group controlled by Digital First Media.
As part of the arrangement, DFM bought the remaining ownership stake that Stephens Media had in the California papers by making a cash payment to Stephens. Gannett also made a cash payment to DFM.
“We are very pleased to welcome these well-respected media organizations to U.S. Community Publishing,” Robert Dickey, president of U.S. Community Publishing, a Gannett unit, said in a statement.
DFM, Gannett, and Stephens Media had been involved in multiple long-term partnerships that owned a diverse array of newspapers in multiple states.
Monday’s deal with Gannett was part of actions involved in an earlier plan by DFM to sell the entire company to Apollo Global Management, a New York-based hedge fund. In May, however, DFM took itself off the market, announcing in a memo to employees that selling the company was “not in the best interest of shareholders.”
A controlling interest in DFM is held by Alden Global Capital, another New York-based hedge fund. Digital First was created in September 2011 to manage the newspapers of the former Journal Register Co. and Denver-based MediaNews Group.