The Richmond Times-Dispatch and most of the other newspapers owned by locally based Media General are getting a new owner: The Oracle of Omaha.
Media General said Thursday in a press release that a division of Warren Buffett’s Berkshire Hathaway is buying all the company’s newspapers — excluding the Tampa Group — for $142 million.
“In towns and cities where there is a strong sense of community, there is no more important institution than the local paper,” Warren Buffett said in the release. “The many locales served by the newspapers we are acquiring fall firmly in this mold and we are delighted they have found a permanent home with Berkshire Hathaway.”
Berkshire Hathaway will also take control of the websites that complement the local papers, which in Richmond presumably includes Richmond.com.
The sale would close June 25 and is subject to Federal Trade Commission and anti-trust reviews.
Media General will still own TV and radio stations across the Southeast.
Other daily newspapers that Media General owns in Virginia include the Daily Progress in Charlottesville, the Danville Register & Bee, the Lynchburg News & Advance and the News Virginian in Waynesboro.
Buffett has long been a fan of newspapers, often saying that if he weren’t a professional investor, he would have liked to have been a reporter. Berkshire Hathaway also owns the Buffalo News of New York and the Omaha World-Herald.
You can read more about the deal in this very thorough story from the Omaha World-Herald.
Yay! Hope the paper changes and becomes much livelier. When do we start tapping phones?
Never mind, I am thinking of Rupert Murdoch. This won’t be as fun.
On it’s face, it seems very positive & enlightening that one of the most respected & successful investors of our time has elected to expand his holdings in the print media.
I’d love to see an editorial comment from the Editor of BizSense re: this; as I’m sure he’s more informed than me as to the possible agendas of the acquisition .
The committment to jounalistic integrity as one of the founding cornerstones of BizSenses mission statement always adds great weight to their perspective.
Of course no Media General writer would ever publish this, as even if they were smart enough to understand, (which they’re not)…
Last time I checked, when your company is treading water, and your earnings are trending downward for a sustained period of time, selling the company is a last resort, not a reason to celebrate.
Berkshire likely sees opportunity in a poorly run company, with natural demand, as everyone reads the paper, whether in print or online.
At a $140 million purchase price, and 63 newspapers, that’s $2.2 million per paper on average. At ten times earnings, that’s like saying that a newspaper only needs to profit $200k per year to be a decent investment.
Once he makes some improvements, this purchase is a steal.