E.W. Scripps Co. and Journal Communications announced an agreement Wednesday night to combine their broadcast assets and turn their newspapers into a separate company, Bill Glauber reports in the Milwaukee Journal Sentinel.
Among the 15 newspapers that the new Journal Media Group will hold: The (Memphis, Tennessee) Commercial Appeal, the Knoxville (Tennessee) News Sentinel and the Kitsap Sun of Bremerton, Washington. All of those were previously owned by Scripps; the Journal Sentinel is Journal Communications’ biggest paper.
With 35 stations, Scripps will become the fifth-largest independent TV group in the country after the deal goes through. It also picks up Journal Communications’ 34 radio stations.
“It is no surprise that Scripps would want to move its broadcasting and digital properties from the print holdings just as it moved its considerable cable holdings some time ago,” Poynter’s Al Tompkins said in an email. Broadcast groups have been getting bigger in part so can have more leverage with cable companies, and in part because they need “negotiating muscle with their own networks who want a bigger piece of the retransmission revenues. With this move, Scripps becomes a powerhouse player in the ABC network.”
Last year Poynter’s Rick Edmonds wrote about some of the forces driving consolidation in the local-TV business. Among them: Easy access to financing, the lure of centralized functions and a gusher of political ad cash every two years.
Scripps, Tompkins said, “is well positioned to cash in on mid-term political spending with stations in hotly contested political grounds of Ohio and Florida.”
Katerina Eva Matsa wrote about the consolidation trend for Pew earlier this year: “As of today,” she wrote in May, “five companies own one-third of the about 1,400 local TV stations in the country.”
Timothy E. Stautberg will run Journal Media Group, which will launch with “$10 million in cash and no debt,” Glauber writes. The companies expect the deal to close next year.
The Scripps National Spelling Bee “will remain under the stewardship of The E.W. Scripps Company,” Scripps says in a release.
Here’s Scripps chairman and CEO Richard A. Boehne outlining the deal to employees: