The next divestiture: WSJ reports Classified Ventures will try to sell Cars.com
Report of sales of online auto site comes after Apartments.com sales has closed
The newspaper groups behind Classified Ventures – Gannett, Tribune Co., McClatchy, A.H. Belo, and Graham Holdings – appear to believe now is the time to cash out. The WSJ reports that the joint venture plans to put the Cars.com franchise up for sale, hoping to find a buyer willing to pay up to $3 billion.
Recently Classified Ventures was able to sell Apartments.com to CoStar Group for $585 million. That sale gave the newspaper owners a much needed cash infusion – A.H. Belo, for instance, said they will get $18 million from the sale.
But it is also true that some of these media firms feel a need to cash out now, before they spin off or sell their newspaper properties. Tribune Co. will spin off their properties later this year, and rumors are that Gannett is looking at that option, as well. Graham Holdings, which is no longer a newspaper owner now that it has sold The Washington Post, would probably just like to see the backside of anything newspaper related.
Newspapers have seen a dramatic decline in their classified advertising. At many papers, classified ad revenue accounted for 50 percent or more of all revenue sold back a decade or longer ago. But classifieds evolved, not only going online, but into shoppers, traders and other forms of media. Most newspapers simply resisted doing anything that they felt would dilute their classified sections. Others, such as the companies behind Classified Ventures, hoped to keep some revenue by investing in an online venture. If they can sell off at their price, they may feel they can justify their strategy – thought that would be a stretch.