Digital First Media may now sell off assets piecemeal after failing to complete sale to PE firm
CEO John Paton to leave Digital First Media to lead IVA Ventures
The sale of Digital First Media to the private equity firm Apollo Global Management has apparently collapsed, likely leading to the company selling off its newspaper properties piece meal, something that probably always made sense. But with the failure to find a buyer, the company’s CEO, John Paton, today announced via Twitter that he leaving DFM to lead IVA Ventures. COO Steve Rossi will now assume the CEO role.
Paton tried to put a happy face on the fact that DFM could not find a buyer in a memo to staff:
“You will recall that back in September, DFM announced a strategic review process – meaning we would look at all of our options for the future, including potentially the sale of DFM as a whole or in regional clusters, or the continued execution of our business plan,” Paton and Rossi wrote in the memo obtained by Jim Romenesko. “While the review process is not complete it has been determined that a sale of the Company as previously speculated is not in the best interest of shareholders at this time. However, we continue to have discussions concerning selected assets, and we are looking at potential acquisition opportunities.”
Digital First Media’s owner, Alden Global Capital, will likely now look to find buyers for its separate properties. DFM properties include The Denver Post, and community newspaper groups in both Northern and Southern California.
Tribune Publishing, owner of the Los Angeles Times, recently announced it had acquired the San Diego Union-Tribune (see report here). It would be a logical buyer for the Southern California properties which include the Los Angeles Daily News, Pasadena News-Star, Long Beach Press-Telegram and Torrance Daily Breeze, but it may be all a matter of the sales price. These properties were all owned by MediaNews Group before that company was merged into DFM. MediaNews Group was founded by Dean Singleton who also gathered up the Northern California properties – starting with the Alameda Newspaper Group, then acquiring the San Jose Mercury News and the papers that once made up Lesher Communications.