Archive for the ‘Muskogee’ Category

Documents reveal value of dumped newspaper

March 28, 2008

Current and former company executives use the Gannett Foundation to entertain themselves — pretending to be philanthropists, and financing their fantasy partly by selling off Gannett’s patrimony: community newspapers. The foundation’s most recent public tax return reveals the price of this folly.

Two years ago, Gannett “donated” Oklahoma’s Muskogee Phoenix to the foundation — on April 3, 2006 — then sold it downmarket about three weeks later for $24.5 million, the return shows, to privately held Community Newspaper Holdings of Birmingham, Ala. At the time, Gannett said the sale was part of its growing clustering strategy: Favoring newspapers that are near other papers, so the company can better merge editorial, business and other functions, to save money. “It was nothing about the people or the paper,” said Dan Ehrman, vice president of planning and development, according to Editor & Publisher. “We’re looking to build tighter clusters.”

Gannett had owned the Phoenix, founded in 1888, since 1977, U.S. Securities and Exchange Commission filings show. Daily circulation was around 17,000. That means the sale price averaged $1,441 per subscriber. Long, long ago, when I reported on newspaper sales, the going price was around $1,000 per subscriber.

It’ll be interesting to see how much the foundation got for last year’s sale of the Chronicle-Tribune in Marion, Ind., when it was sold to Paxton Media Group, a corporate chop shop based in Paducah, Ky. We should know more when the foundation’s 2007 tax return is filed later this year. In any case, the market for newspapers has been especially weak, given plunging revenue across the industry.