News Corp open discussions with potential buyers for regional and local mastheads
News Corp is opening its regional and local newspaper books for discussions with potential buyers.
According to a piece published in the News Corp-owned masthead The Australian yesterday, the company has hired investment bank Citi as an advisor. The story also suggests potential suitors are already circulating, including equity firms Anchorage Capital and Apollo.
News Corp bought the regional titles in 2016
News wouldn’t sell these if they were making them money.
The newsroom consolidation model they run should make the ‘news’ part trivial, except the whole point of a local paper is local news, which means boots on the ground, which means labour costs. So the part they could do simply (sack the subbies and re-sell content from other news assets) doesn’t work for the small towns. And print costs? How do you do a daily in a regional, printed in the CBD? So its expensive to ship and sell too. I’d love to know how big the returns piles are from the local newsagents. Are there local news agents any more?
Any buyer has to be looking to a realistic market value. I think it will be fascinating to work out how much worth was destroyed during the News Ltd ownership. Not necessarily their fault, but the underlying model has completely caved in: If I want a local handyman I’m heading to gumtree
News also acquired the APN/ARM regional print sites, I’d be very surprised if they weren’t immediately taking advantage of that in a variety of ways.
And if you want to see worth destroyed, oh boy, wait till the PE folks take over. Anchorage was responsible for what they call the Dick Smith “turnaround”, which I’d say is an incredibly charitable assessment of what happened and indeed what PE and Anchorage does. But I’m just a simple IT guy, so who knows.
Yes, newagencies still exist just about everywhere. One small town near where I live lost their’s a few years ago. And within about a year it was replaced with a brand new bigger one.
Many regional papers are printed in the communities where they’re read.
We can only hope that a company dedicated to news production buys the papers. The papers would fit Fairfax perfectly, but they have no money. Seven West might be interested.