Scripps split adds pressure on GCI

Yesterday’s announcement by E.W. Scripps that it plans to split into two — one company with newspapers and TV stations, the other with cable and other digital properties — puts renewed pressure on Gannett, which reports third-quarter earnings this morning. Scripps’ move follows a similar one by Belo earlier this month.

I wonder if a similar move by GCI would have the same stock-boosting effect, however. (Scripps closed up a whopping 8.6% after Tuesday’s announcement.) For one thing, Scripps and Belo aren’t as dependent on newspaper revenues, so they may be better positioned to carve out viable digital companies from their non-paper assets.

Gannett, by contrast, got nearly 83% of its $1.9 billion in revenue from newspapers during the second quarter. The balance came from TV stations and other non-paper revenue sources. A spinoff such as Scripps is often a pre-cursor to an outright sale. But who would buy the behemoth of GCI papers in a similar spinoff?

For more on these spinoffs, the New York Times’ DealBook blog has a nice summary, here.

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