Gannett reveals details of newspaper spinoff
Name brand digital assets will become part of broadcast company, while the new newspaper company has signed agreements that may limit ability to launch new digital initiatives
The paperwork was filed today to being the process of spinning off the publishing side of Gannett into what is now being called Gannett SpinCo, Inc. Two separate companies, one with broadcast (and the real digital goodies), and another with what the shareholders want to get rid of, print, will be created.
“The filing of the registration statement for the publishing business is a key step forward in completing our separation, which will create two sharply focused, independent companies with enhanced flexibility to align their strategies and resources with their growth profiles and priorities,” Gracia Martore, president and chief executive officer, said.
“While the publishing business and its related digital assets will be spun off as a new publicly traded company, it is a long-established industry leader, rooted in journalistic excellence and innovation, and it will continue to operate under the Gannett name. We are incredibly excited to turn the page to this next chapter in Gannett’s storied, 108-year history,” Dickey is quoted as saying in today’s announcement (though that quote had to come from a PR person as no one talks like that).
Like the Tribune Company spinoff, the new newspaper company will be forced into agreements with the digital assets that will go to the broadcast side: CareerBuilder, Cars.com and G/O Digital. As a result, the newspaper will actually be driving digital growth for the broadcast company, while having their hands tied as to new digital initiatives – not that Gannett has been known for building their own digital assets in any case.
Additionally, both the new publishing and broadcast companies have pledged stock repurchase programs – which will, of course, reward both shareholders and Gannett’s upper management for splitting the company up.