Media General to divest one-third stake in SP Newsprint
By Leah McBride Mensching, Friday 18 January 2008 at 23:14 :: Media Ownership :: #1128 :: rss
Media General, Inc., will divest its one-third stake in SP Newsprint Co., selling its piece to White Birch Paper Company, and use the proceeds of the sale to reduce its debt, SP announced Friday.
Two other equal partners in SP are Cox Enterprises, Inc. and the McClatchy Company. Media General expects to make $37 million to $40 million from the sale after taxes, and will put the funds toward debt repayment, PR Newswire reported.
The sale is expected to be complete within the first four months of 2008.
The sale will end in a non-cash book loss for Media General, which will be accrued in the company's fourth-quarter 2007 results, according to PR Newswire. However, it will be offset by a Q4 gain from its insurance settlement due to a June 2007 fire at the company's printing plant for the Richmond Times-Dispatch.
“For Media General, the sale of our interest in SP will eliminate the earnings volatility we have experienced in recent years from our investment. Moreover, the transaction will benefit Media General by enabling us to focus fully on our core business as a pure media company. In that regard, we have been at the forefront of media industry initiatives to aggressively implement new ideas for audience and revenue growth as we pursue our mission of providing excellent local content in growth markets over multiple platforms,” said Marshall Morton, president and CEO of Media General, according to PR Newswire.
Comments
No comment.
Post comment