New Media Investment Group Merger: When Will It Be Finalized?

The merger between New Media Investment Group and Gannett was approved by shareholders in November 2019 and was finalised shortly after. The deal, worth approximately $1.1 billion, created the largest U.S. media company by print circulation, with the new company, Gannett, owning more than 260 daily publications and hundreds of weeklies. The merger was expected to result in thousands of layoffs and the companies stated that it would lead to annual cost savings of up to $300 million.

Shareholders of Gannett and New Media Investment Group approve merger

Shareholders of Gannett and New Media Investment Group have approved a merger that will create the largest US media company by print circulation, with a significant online news audience. The deal will see Gannett acquired by New Media for $1.13 billion, with the new company taking the Gannett name and owning more than 260 daily publications, as well as hundreds of weeklies.

The merger was finalised on Tuesday, with New Media CEO Mike Reed becoming CEO of the new Gannett, and Gannett's current CEO, Paul Bascobert, retaining that title as head of the new company's operating subsidiary, also to be called Gannett.

Bascobert said the deal would give the companies a broader platform to build their digital businesses and help local markets become "engines of growth". He added that the new Gannett would be committed to delivering great quality journalism.

The new Gannett will have to face the challenge of offsetting print revenue decline with new sources of digital revenue. It will also have to cut $275 million to $300 million in costs per year within 18 to 24 months to pay off a $1.8 billion loan from Apollo Global Management, which New Media used to finance the acquisition.

New Media Investment Group to acquire Gannett for $1.13 billion

On August 5, 2019, New Media Investment Group announced it would acquire Gannett Co. for $1.4 billion, creating the biggest U.S. newspaper owner and publisher. The deal was approved by shareholders of both companies in November 2019, with the merger expected to be finalised on November 19, 2019.

The acquisition was valued at approximately $1.1 billion as of Monday's market close, according to a regulatory filing with the Securities and Exchange Commission. This was down from about $1.4 billion when the deal was first announced due to a decline in New Media's stock price.

The merger will create the largest U.S. media company by print circulation, with the new company owning more than 260 daily publications, as well as hundreds of weeklies. The new company will also vie for the nation's biggest online news and information audience, with an average monthly online audience of more than 145 million unique visitors.

The new Gannett will be led by New Media CEO Mike Reed, with Gannett CEO Paul Bascobert becoming CEO of the company's operating subsidiary, Gannett Media Corp. The new company will be headquartered in McLean, Virginia.

The companies expect to cut costs by $275-300 million annually by shedding overlapping costs and achieving a digital transformation built on increased revenue from digital products, marketing services, online advertising, and paid subscriptions. The cost-cutting measures are critical to paying off an $1.8 billion loan from private equity firm Apollo Global Management that New Media obtained to help finance the deal.

Merger creates the largest US media company by print circulation

The merger of New Media Investment Group and Gannett has been approved by shareholders of both companies, creating the largest US media company by print circulation. The deal, worth $1.1 billion as of Monday's market close, will see Gannett and its publication USA TODAY join forces with New Media Investment Group and its subsidiary GateHouse Media. The new company, which will retain the Gannett name, will own more than 260 daily publications and hundreds of weeklies, reaching over 145 million unique visitors monthly.

The merger is expected to catalyse the digital transformation of the new company's local and national news brands, including USA TODAY, into a powerful digital media entity. The CEOs of the new Gannett, Mike Reed and Paul Bascobert, have emphasised their commitment to journalistic integrity and their belief in the compelling opportunity to reinvent the business and boost digital revenue.

However, the success of the merger hinges on the company's ability to shed overlapping costs and achieve significant cost savings, which are critical to paying off the $1.8 billion loan acquired to finance the deal. While analysts are divided on whether the targeted savings will be achieved, the company asserts its confidence in surpassing the high end of the projected range.

The new Gannett will face the challenge of counteracting the decline in print revenue with new sources of digital income. This involves a strategic shift from an advertising-based business model to a software-based one, leveraging the online brands cultivated by its publications in local markets. The company will also need to invest in journalism to boost subscriptions and maintain its commitment to delivering high-quality investigative and local reporting.

The merger has sparked concerns about potential industry layoffs, as efficiency gains and cost-cutting measures may impact newsroom jobs. However, executives have assured that the deal will "enhance quality journalism," and Reed has expressed confidence in achieving cost-saving goals without deep newsroom cuts.

New Media Investment Group criticised for cutting jobs to increase profits

The New Media Investment Group, a New York-based private equity firm, has faced criticism from the NewsGuild, an affiliate of the Communications Workers of America labor union, for its practices of purchasing newspapers, consolidating editorial practices, and cutting jobs to increase profits. The group's acquisition of rival publisher Gannett and its subsequent merger with GateHouse Media to create the largest newspaper publisher in the US has been a source of concern for journalism advocates, who fear heavy-handed layoffs in already strapped newsrooms.

The New Media Investment Group's strategy of consolidating editorial practices and cutting jobs has been criticised as detrimental to the quality of journalism and the wellbeing of journalists. The group's focus on increasing profits has been seen as prioritising financial gains over the integrity of the news industry. This has resulted in industry-wide layoffs and the printing of "ghost papers," diminished versions of once larger papers published by skeleton staff.

The merger between New Media Investment Group and Gannett was finalised on Tuesday, November 19, 2019, resulting in the creation of the largest US media company by print circulation and one of the nation's biggest online news and information audiences. The new company, called Gannett, owns more than 260 daily publications and hundreds of weeklies, reaching an average monthly online audience of over 145 million unique visitors.

While the merger was expected to bring about cost savings of up to $300 million per year, it has also led to concerns about potential job losses and further cuts in newsrooms. Journalism advocates worry that the deal will result in additional stress for journalists who have already faced budget reductions. Despite assurances from the company that it will achieve cost-saving goals "without deep newsroom cuts", there is scepticism about the potential impact on journalistic quality and the livelihoods of those working in the industry.

The New Media Investment Group's actions reflect a broader trend in the media industry, where contraction, layoffs, sales, and labour unrest are prevalent. The industry is facing a crisis similar to that of 2008, with layoffs and cost-cutting measures becoming increasingly common. The challenge of declining web readership and the dominance of tech giants like Meta and Google have contributed to the turbulent state of the media sector.

New Media Investment Group and Gannett CEOs outline plans for the future

The merger between New Media Investment Group and Gannett was approved by shareholders in November 2019, with the deal closing on Tuesday, November 19. The merger created the largest US media company by print circulation, with the new company, Gannett, owning more than 250 daily publications and several hundred weeklies.

The new company's CEOs, Mike Reed and Paul Bascobert, outlined their plans for the future of the company in a joint interview with USA Today. They stated that they have a "compelling opportunity" to reinvent the business and expand digital revenue, with a focus on its journalistic mission. Bascobert outlined a strategy based on lead generation in local markets, similar to the approach taken by companies like Angie's List and Yelp. This would represent a shift from the company's previous reliance on advertising and marketing services, which accounted for over 51% of its revenue in the first nine months of 2019.

In the short term, the success of the merger is linked to the company's plan to cut costs by $275-$300 million annually within 18-24 months, which is crucial to paying off a $1.8 billion loan from Apollo Global Management. Reed stated that these cost savings can be achieved "without deep newsroom cuts," and Bascobert affirmed the company's commitment to delivering "great quality journalism."

The new Gannett will also need to address the challenge of offsetting print declines with digital revenue. The company's digital subscriptions have been growing, with Gannett's digital subscriptions rising 27% and New Media's subscriptions increasing by 65% in the third quarter compared to the previous year. This growth will require continued investment in journalism to boost subscriptions.

The combined company will be well-positioned to become a leading digital media player, with a broad network of talented journalists and a range of digital marketing services.

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