Media General is selling off its struggling newspapers.
The company today announced a deal with Berkshire Hathaway for the purchase of all of its newspapers, with the exception of its Tampa group, which includes The Tampa Tribune, for $142 million in cash. Media General is currently in discussions with other prospective buyers about its Tampa print assets.
Under a separate agreement, Berkshire Hathaway will provide Media General with a $400 million term loan, which will be used to pay off bank debt, and a $45 million revolving line of credit.
“In towns and cities where there is a strong sense of community, there is no more important institution than the local paper,” Berkshire Hathaway chairman Warren Buffett said in a statement. “The many locales served by the newspapers we are acquiring fall firmly in this mold and we are delighted they have found a permanent home with Berkshire Hathaway.”
The move will allow Media General to focus on its TV stations, which accounted for 87% of the company’s cash flow during the first quarter of this year.
“This single transaction for virtually all of our newspapers accelerates the timing of our strategy to focus on our broadcast television business and its future growth opportunities, including digital content and Mobile DTV,” said Marshall Morton, Media General’s president and CEO.
Media General currently owns 18 network-affiliated stations.