A lot of people were talking about this yesterday, and the Boston Globe’s Steve Bailey nailed it down sufficiently to put it into print (scroll down) today: Pat Purcell will sell his 100 or so suburban papers in Eastern Massachusetts and hang on to the Boston Herald. The deal would presumably get Purcell out of the heavy debt he took on to buy the local papers from Fidelity Capital a few years ago.
Still, Purcell — who tried to hire Bailey a couple of years ago — cautions that there’s nothing to announce. So who knows?
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Not a bad clip: $160 million flipped for $370 to $400 million. While it is true that the CNC papers turn over a decent profit, it has been at the expense of editorial costs, which have been kept down to virtually nil. If the company splits, the equity firm or whoever needs to realize that the company is at the lowest point of overhead to do business at. There isn’t room for anymore cuts.
Let me see if I follow this correctly.An unnamed private equity firm wants to be the profitable CNC division, thus giving Pat Purcell the cash he needs to sustain the Herald.The same firm will also buy The Patriot Ledger and the Enterprise. I presume Enterprise NewsMedia’s expanding MPG division isn’t included in that sale. Unless Steve Bailey forgot about it.My question is: Why does this buyer want the Ledger and Enterprise?