CEO: Journal Communication brands to operate the same
Merged media companies to allow for greater focus

By Katherine Michalets - Special to The Freeman

August 1, 2014

MILWAUKEE -Citing an agreement between E.W. Scripps and his company, Journal Communications Chairman and CEO Steve Smith said the “transaction helps ensure the future success of local news operations - print, broadcast and digital - across the nation.”

Discussions began in February about a possible merger of the two large media companies, Smith said via email Thursday.

“We knew Scripps and had looked upon the company for a long time with a great deal of admiration,” he said. “Our cultures are very similar. Over the last few months it became clear that this was a very natural fit.”

As part of the deal, E.W. Scripps and Journal Communications will merge their broadcast operations while spinning off their newspapers into a new company called Journal Media Group, which will be headquartered in Milwaukee, according to the announcement made Wednesday. The E.W. Scripps Company headquarters will remain in Cincinnati and the company will own and operate television and radio stations serving 27 markets in the country, making it the fifth-largest independent TV group in the country.

The agreement is contingent upon the approval of each companies’ shareholders. It is anticipated to become complete in 2015.

 

New group to own four Southern newspapers

After combining the two companies’ newspapers, Journal Media Group will have penetration in 14 markets across the United States and will own the Knoxville News Sentinel in Tennessee, The Commercial Appeal in Memphis, Tenn., the Standard Times in San Angelo, Texas, and Naples Daily News in Florida.

According to the announcement, the Journal Media Group is anticipated to have annual revenue of more than $500 million and approximately 3,600 employees. The Journal Sentinel will be the new Journal Media Group’s flagship newspaper, Smith said.

“The transaction is an important milestone for Journal Communications and its shareholders,” Smith said in the email. “The transaction will realign both Journal and Scripps and allow each - Scripps and the new Journal Media Group - to focus all of its efforts on either broadcasting or publishing, increasing its ability to innovate and compete in its industry.”

The deal is also anticipated to create potential value for both companies’ shareholders, he said. 

There will be a change in leadership at the companies upon the merger. Rich Boehne will remain as chairman, president and CEO of E.W. Scripps, but Smith will no longer be CEO of the new Journal Media Group, being replaced by Tim Stautberg from Scripps, according to Journal Communications’ website. Smith will be non-executive chairman.

 

WTMJ radio, TV stations will join Scripps

TMJ4 and 620 WTMJ will become part of the E.W. Scripps company and will join 33 other TV stations and 34 radio stations for a projected combined revenue of $815 million to $830 million, according to the announcement.

Smith said Scripps is excited about re-entering the radio business with Journal Communications’ radio stations, including 620 WTMJ and the The Lake FM.

“As a leading product of 620 WTMJ, Right Wisconsin will continue to be a popular platform for Wisconsin’s conservative voices and discussion. We fully expect all of our local TV, radio and affiliated digital brands to continue to serve their audiences and have the same great commitment to their local communities when the stations become part of Scripps after the closing of the transaction,” Smith said in his email.

Anticipated benefits for Journal Media Group include management focus on operating core newspaper business, operational efficiencies, a strong balance sheet with no debt and an ability to grow through accretive and opportunistic acquisitions, according to the announcement.

The merger of the broadcast components of Journal Communications and E.W. Scripps will allow the company to reach consumers in eight presidential battleground states, including Michigan, Arizona, Ohio and Florida, according to the announcement.

Despite the transition, Smith said the current Journal Communication brands will continue to “operate as they do today.”

“This means that viewers, readers and listeners in their local markets will still be able to tune into and read all of the content available to them through their favorite local publications, TV channels and radio stations, including the Milwaukee Journal Sentinel, 620WTMJ, TODAY’S TMJ4, The Lake FM and all of our great community publications and digital products,” he said.

Boehne could not be reached by phone Thursday, but in a statement he also commented on the future of the merged companies.

“Making the combinations even more appealing are the rich histories of these two organizations, both driven by a deep commitment to public service through enterprise journalism. For shareholders, this deal should unlock significant value as both companies gain efficiency, scale and more focus on the industry dynamics unique to these businesses,” he said.

www.journalcommunications.com

www.scripps.com