Articles about "Halifax Media Group LLC"


Expansionary Halifax Media looks beyond its Southeast base for next buy

The Worcester (Mass.) Telegram & Gazette, long up for sale, reported Thursday that an executive team from Halifax Media Group had been in the building for several days of talks with management — a signal that the company is a likely buyer.

Halifax who? The Florida-based company, barely four years old, now has 35 dailies. With a billionaire backer, Warren Stephens of Arkansas, Halifax is pushing to the front of the line as mid-sized and smaller papers come up for sale. It bought the 16-paper New York Times Regional group for $143 million in December 2011 and 19 Florida and North Carolina dailies and weeklies from Freedom Communications six months later.

Halifax is little-known by design. Except for the occasional letter to readers, CEO Michael Redding typically does not do interviews (and I got no response to an email request that he discuss the company’s growth). But Halifax is exemplary of an acquisition boom in recent years. While billionaire hometown buyers like The Boston Globe’s John Henry or the Star Tribune’s Glen Turner get the ink, the consolidators are scooping up smaller papers by the dozen.

A landmark event for the sector occurred last September. GateHouse Media simultaneously went through a prearranged Chapter 11 bankruptcy, purchased the Dow Jones local media group (formerly the Ottaway chain) and re-emerged as publicly-traded New Media Investment Group. The reorganized company, backed by Fortress Investment Group, has indicated it has enough capital to make further acquisitions and will.

Sellers who want out and the prevailing bargain-level prices are driving this opportunistic group of buyers. Halifax was formed in 2010 to buy the Daytona Beach News-Journal from court receivership for just $20 million. The paper had been the subject of a long court battle between minority shareholder Cox Enterprises and the Davidson family owners, losing most of its value as the suits dragged on.

The Worcester paper, for that matter, was purchased by The New York Times for $296 million in 2000 but was assigned a value of only $7 million as part of the sale of The Boston Globe to Henry last August.

Halifax’s way of operating remains mysterious but appears typically to involve newsroom layoffs and a booster-ish editorial tone. Shortly after the purchase, Redding announced the pro-business stance in an open letter to Daytona Beach readers, breaking with the liberal-leaning former owners.

Kevin Drake, newly installed as publisher of the Lakeland Ledger, struck a similar note in another Open Letter to Readers 10 days ago:

Our editorials will advocate for our community and the potential we have here. We will support free enterprise and the benefits that come with a stronger economy. A thriving business environment elevates a community. We will point out positive opportunities for our city, county and state.

The Sarasota Herald Tribune — the largest in the Halifax group — was a Pulitzer finalist in 2010 and a winner in investigative reporting in 2011. Though publisher Diane McFarlin and editor Mike Connelly have left for other jobs, I am told the Herald Tribune retains at least some of its enterprise reporting bite.

Several other of the acquiring firms like GateHouse and Warren Buffett’s BH Media Group also have tended to be aggressive in downsizing newsrooms and consolidating editing and layout functions at centralized hubs.

Those two, along with Digital First Media and long-established CNHI (Community Newspaper Holdings), have a national footprint. Until now, Halifax has operated only in Florida and four other Southeastern states. It sold the Santa Rosa Democrat in California wine country, which had come as part of The New York Times group deal.

Acquiring Worcester would move Halifax further afield into New England, once a center of thriving, editorially ambitious smaller newspapers, but for the last decade a center of ownership changes, consolidation and downsizing.

It is noteworthy that Stephens, the lead among the three private investment firms that control Hallifax, has a media group of 11 Western dailies of its own, with the Las Vegas News-Review its flagship. It is possible the two groups could be combined at a future date.

Warren Stephens, nearly as sparing as Redding with public comment, did discuss acquiring The New York Times group, as part of a long interview with Steve Forbes in 2012. Echoing Warren Buffett’s comments on the durability of local franchises, he said:

I don’t think the news gathering aspects of magazines or newspapers are going to go away. I think at some point in time there’s going to be a realization that the professionalism of the reporters, the editors, the people that determine what’s going to make it into a publication and what’s not going to make it into a publication is actually worth something.

In newspapers’ particular case, I just don’t think there’s any way you’re ever going to get local news, sports, politics from any other source but your local newspaper. The purchase of the New York Times group – most of those papers are pretty small newspapers by most standards. We’re very optimistic that we can improve their operations, but also that in the long run those are going to be great, long-term assets for us.

It remains an open question whether firms like Halifax will be the wave of the future, dominating the management of small and mid-sized papers. No dispute though, they are a huge ownership force right now. Read more


Warren Buffett not yet done buying newspapers after purchasing 63 from Media General

Warren Buffett, whose Berkshire Hathaway is buying 63 Media General newspapers, told the Omaha World-Herald, which he also owns, he’s not planning any future newspaper purchases, but he’d consider them:

“There aren’t a lot of buyers in the field whose checks will clear. … Any time we can add properties we like, to management we like, at a price we like, we’re ready to go.”

These purchases are not sentimental, said Wally Weitz.

“When it comes to Media General, it’s going to be all business,” Weitz said. “As a Berkshire shareholder, I have to assume that he knows more about investing in newspapers than anybody else, and he’s had decades of recognition that the business has changed and it’s not what it used to be. I would trust him to have made a really good deal.

“Sometimes he does things and you don’t figure out why until later.”

Buffett said the dailies are “all doing OK, to varying degrees, and I think they’ll do even better when we get our people in there. They’re keepers.” Read more

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Halifax Media in talks to buy Freedom papers

Wall Street Journal | Richmond Style Weekly | Seeking Alpha
John Cribb thinks he knows why small- to mid-size newspapers remain attractive to investors. While many bigger papers have been flummoxed by the erosion of their missions and business models, their less hulking cousins still dominate newsgathering in their markets. “[T]here is franchise value there and it’s protected value,” says Cribb, whose company Cribb, Greene & Associates brokers newspaper sales.

Russell Adams reports that Freedom’s daily newspapers are wending their way toward new owners. Halifax Media, he says, is negotiating for Freedom’s Florida and California papers. Halifax bought the 16 New York Times Regional Group papers for $143 million in a sale that closed earlier this year. Those papers include Florida’s Sarasota Herald-Tribune, the Gainesville Sun and the Lakeland Ledger. The company also owns the Daytona Beach News-Journal. In California, Halifax now owns The Press Democrat and the Petaluma Argus-Courier. Read more

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Halifax lays off more than half of staff reporting to former NYT Regional HQ in Tampa

About 30 employees of the former New York Times Regional Media Group were notified Friday that their new employer, Halifax Media Group, has decided to lay them off and offer severance packages. The other 20 were offered positions, but only if they relocated to Daytona Beach, Fla., where Halifax is headquartered.

A letter accompanying documents distributed Friday said Halifax “has reviewed the company’s Tampa operations to see where additional efficiencies can be achieved by eliminating or consolidating certain job functions and operations.”

Employees “who were offered a package were told that they wouldn’t be given severance if they speak to the media or publicly discuss the situation,” said one source. A second source confirmed the confidentiality clause, which reads, in part:

Employees agree to hold confidential both the terms of this agreement and the circumstances underlying it, except [to] the extent that he is required to reveal information under legal process. Employee may also reveal the details of this agreement to employee’s immediate family, accountant and attorney, but only if those individuals agree to keep confidential the information revealed to them.

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NYT limited layoffs to 200 employees in sale to Halifax

In its deal to sell 16 regional papers to Halifax Media, The New York Times Co. limited layoffs to 10 percent of employees, according to an SEC filing from Dec. 27, 2011. Since the New York Times Regional Group employed about 2,000 people at the time of the sale, according to the Times’ Abbe Serphos, that means about 200 people could have lost their jobs when the sale was completed. Though the agreement required Halifax to provide the Times with a list of names of everyone it intended to let go, the Times is not commenting on whether Halifax laid off the maximum number.

In addition to the challenges they faced with a noncompete that has now been nullified, former NYTRG employees have been confused about whether they could work for The New York Times Co. after the sale of their papers to Halifax. The SEC filing reveals that they can be hired by the Times as long as they are not recruited by their former employer for the next two years. The filing also shows that for three years the Times cannot own or operate a local news business in the 15 markets it has just left. (You can read the relevant clause after the jump.)

The deal to sell the papers also guaranteed “comparable wage rates or base salary and bonus levels” for employees. It also continued all “eligibility, vesting and benefit entitlement under all compensation and benefit plans.” || Related: Halifax noncompete will not apply to former New York Times Regional employees (Poynter) Read more


Halifax requires former NYT regional employees to sign noncompete agreements

Halifax Employee Agreement
Employees at the 16 papers now owned by Halifax Media Group are being asked to sign an agreement that allows the company to fire them anytime but prevents them from working for media companies for two years in any other city with a Halifax property. Those include mid-size cities in Alabama, California, Florida, Louisiana, North Carolina and South Carolina. A tipster said employees have until tomorrow to decide whether to sign or lose their jobs. I also hear Halifax has a nepotism policy that prevents family members from working in the same newsroom. It’s unclear whether existing couples will be grandfathered in or asked to comply. || Previously: Halifax emails NY Times Regional staff about jobs Read more


Halifax emails NY Times Regional staff about jobs

Emails are arriving today to staff at the 16 papers The New York Times Co. is selling to Halifax Media. Employees are being told whether Halifax has decided to keep them or let them go. Here’s the “good news” email:

Dear Regional Media Group Colleague,

On Tuesday, Dec. 27, you received an announcement … that the Regional Media Group is being sold to Halifax Media Holdings LLC. We are pleased to inform you that Halifax has informed us that they will be offering you employment.

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New York Times announces sale of 16 regional papers for $143 million

The New York Times | News Release
Halifax Media is buying 16 newspapers from The New York Times in a deal that is expected to close within the next few weeks. The Times acknowledged the likely sale last week after Halifax prematurely published the newspapers’ names on its website, in a list of properties it owned. The regional papers are no longer as profitable for the Times as they once were, and the company is eager to invest in its digital future and other ventures. Halifax also owns the Daytona Beach News-Journal, which has cut staff and promoted a pro-business agenda since Halifax CEO Michael Redding took over, reports Rick Edmonds. In a news release about the sale, Redding said:

“The purchase of the Regional Media Group reflects Halifax Media’s belief that a good newspaper is an essential part of any vibrant community. The strong local news coverage these papers provide represents not only an important community service, but, in our eyes, a good investment.”

Related: “Halifax has decided who it will hire”: FAQ about the sale for employees (Romenesko) | Guild president: “We’d hope they would use some of the proceeds to settle our contract” (NY Post) | 300+ Times Guild members sign grievance letter to Sulzberger; Staffers considered ‘more dramatic’ action (HuffPost) | Times wants to restart union negotiations (Bloomberg) | What it costs The New York Times to offer buyouts (Atlantic Wire) Read more


Sale of New York Times regional newspapers a sign of increased dealmaking in industry

The New York Times Co.’s clutch of 16 midsized and small newspapers was a relic of the prosperous pre-digital days of the 1980s and 1990s. Back then, the very comfortable margins at these properties (mostly in the Sun Belt) provided reliable cash flow if the more competitive national and New York markets hit a bump.

Now the regional group is not as profitable, and its ad revenue continues to decline substantially as The New York Times’ stabilizes. Those papers probably have become more a management distraction than a cash cushion for the company. So the pending sale of the group to Halifax Media Group, while unexpected, is easy to explain.

The Times Co. can use the proceeds for the next wave of digital development at The New York Times. The company has hinted in presentations to investors and analysts that it hopes to acquire some digital start-ups as well.

The timing also matches a thaw in the climate for such transactions in recent months. During the worst of the downturn when advertising was in free-fall, hardly any newspaper organizations changed hands, except for cases in which private equity firms bought companies — such as the Star Tribune and Philadelphia Newspapers — out of bankruptcy. Attractive properties like the Austin American-Statesman and Landmark’s papers in Norfolk, Roanoke and Greensboro were pulled back from auction after they garnered tepid bids.

This fall, Warren Buffett’s Berkshire Hathaway bought his hometown Omaha World-Herald for $200 million (including assumption of $50 million in debt). A local hotel magnate bought The San Diego Union-Tribune for more than $100 million from hedge fund Platinum Equity. Groups of smaller papers have also started to change hands.

The transaction price for the Times’ newspaper group hasn’t been specified, but I would be surprised if it takes a big tax hit as a result. In better times, huge capital gains exposure was another reason for companies to hold on to what they acquired.

Halifax, the buyer, has only been in business two and a half years, acquiring The Daytona Beach News-Journal for a rock-bottom $20 million out of receivership after a long legal battle between a family ownership group and minority investor Cox. But Halifax does have a potent financial backer in the huge Stephens Group investment firm of Little Rock, Ark. (which also owns the Las Vegas Review-Journal).

As the Daytona transaction was closing in March 2009, the newspaper cut 48 positions from a staff of 470, including most top executives. A year later, the paper raised eyebrows with an offer to pay reporters and editors a commission on any subscriptions or advertising they sold.

So my forecast would be for the usual newsroom cost-cutting, outsourcing and centralized production. The editorial ambition that won the regional group’s flagship, the Sarasota Herald-Tribune, its first Pulitzer this April for an investigation of the insurance industry may not fit with the boosterish, pro-business agenda Halifax defined in Daytona Beach. Read more


New York Times ‘close to selling’ regional newspapers to Halifax Media Group

The New York Times
The New York Times Co. “is close to selling” the 16 newspapers in its Regional Media Group, located in Alabama, California, Florida, Louisiana, North Carolina and South Carolina, to Halifax Media Group. Halifax purchased the Daytona Beach News-Journal in 2010.

The Times’ Amy Chozick reports:

The company’s regional newspapers, which include the Sarasota Herald-Tribune and The Gainesville Sun, accounted for 11 percent of the Times’s $2.4 billion in revenue in 2010. Even as optimism for the digital plan at its The New York Times newspaper has grown, the regional publications have dragged, the steady decline driven by a lack of classified ads and a migration of readers to the Web.

Chozick cites “people familiar with the discussions”; she says a spokesman wouldn’t comment. Minutes after her story was published, the Times said in a news release that it is in “advanced discussions” with Halifax. Read more