New Media Investment Group parent company of the GateHouse Media acquires Gannett Co for $1.38 billion in stocks and cash. The new company operating under the Gannett brand will be the largest U.S. media company.
Gannett company publishes USA Today, the Arizona Republic, and many other well-known local papers. The newspapers are reaching over 145 million readers every month. According to the announcement, the Gannett owners will have control over 49.5% of shares in the new company operating under the same name.
An equally vast portfolio of both firms will benefit the new company. GateHouse has an influence on over 600 markets in 39 states. The merger will create a giant which comprises one-sixth of all newspaper companies in the U.S. Chairman of Gannett’s Board, J. Louis, explains that the merger will provide value for their shareholders, audiences, readers, customers, and employees.
The press release issued by two companies states that the merger is allowed $300 million in cutting costs while concentrating on the digital transformation of the union. The concerned public refers to both companies’ reputation as known to acquire other newspapers.
Gannett just recently made a purchase of Journal Media Group for $280 million. The group was known for The Commercial Appeal in Memphis and the Milwaukee Journal Sentinel. The merger with the chain Tribune ended in a missed bid for the company. The acquisitions made by Gannett ended in imminent layoffs with the newspaper rooms. Also, the experts in the industry do not expect that the justice department interferes with the consolidation.
According to Chief Executive Officer of the new company, M. Reed, the union between the two companies will merge talented employees and portfolios. The synergy will enable the latest company to expand on the markets and broaden its product offering.
The press release claims the merger will save the company from employing new workforce as well as speed up the digitalization of the company. But it is evident that the Gannett stock rose within days of the press release announcing the merger.