For almost a century, the Paxton family business was just a one-newspaper operation, The Paducah (Ky.) Sun, a regional paper serving western Kentucky and southern Illinois.
That changed in 1989, when the family dipped its toe into the acquisition waters and started what would be a steady stream of deal-making. Today, Paducah Newspapers Inc., since renamed Paxton Media Group, owns 26 dailies in the South and Midwest with a total circulation of 260,000 and it definitely aspires to more.
Owen Van Essen, whose firm, Santa Fe, N.M.-based newspaper brokerage Dirks, Van Essen & Associates, has sold Paxton several papers, says Paxton is quickly and quietly making a name for itself.
"Anybody who actively follows the mergers and acquisitions of newspaper companies will know of Paxton," Van Essen says. "Ten years ago, that might not have been true. I think they're very well-respected out there."
The Paxton father-and-sons expansion team still centers around 66-year-old Fred Paxton, third-generation steward of this privately held company.
What stirred the Paxtons' business from a one-horse operation into one with a corral full of publications?
Jim Paxton, editor of the Sun and Fred's oldest son, says questions about the future of a local uranium-enrichment plant back in the late '80s, the bedrock of Paducah's economy, prompted him and his father to start talking about diversifying their assets. "We thought it made a lot more sense to have a number of papers in a number of states," he says.
Fred Paxton had another motive. The patriarch wanted to bring his kids, who were chasing success in other fields, back to the family business that his grandfather, W.F. Paxton, founded 103 years ago.
"It was my hope that at least one of my children was going to come back to run the company, and, one by one, the three boys came back," Paxton says. "With the growth we've having, it looks like there's room for all three of them." A fourth child, Nancy, lives in California.
In an economy that favors consolidation and where family-run businesses rarely make it past the second generation, the Paxton group is bucking the trend.
Starting small, the Paxtons bought The Paragould Daily Press, a family- owned, 6,000-daily-circulation paper in northeastern Arkansas, in 1989. Over the next eight years, Paxton concentrated on the South, using bank financing to collect a dozen more rural and suburban dailies. In 1998, the company branched out to the Midwest with the purchase of Nixon Newspapers' nine dailies, seven of which are in Indiana.
The company has ballooned from 200 employees and less than $10 million in annual revenues a decade ago to 1,800 people and annual revenues of more than $100 million today. Its dailies range in size from the Iroquois County's Times-Republic, circulation 2,900, in Watseka, Ill., to The Paducah Sun, circulation 29,500. The group also owns 21 weeklies and NBC affiliate WPSD-TV in Paducah, the nation's 76th biggest TV market.
Like its bigger counterparts, such as Thomson Newspapers, Ralph Martin's Community Newspaper Holdings Inc. and William Dean Singleton's MediaNews Group, Paxton Media Group has found efficiencies in clustering, or buying newspapers in proximity to each other. Its papers use identical software and accounting methods, and Paxton has group publishers in states where the company has a number of papers.
But, otherwise, the Paxtons preach local autonomy. Bill Horner III, publisher at The Sanford (N.C.) Herald, which Paxton bought in 1998, says his new owner is a budget-driven company that demanded more accountability than the Herald's staff was used to, and, thus, a lot of turnover followed the sale. But, he says, there's no question that good newspapering is Paxton Rule No. 1. "They want the local publisher to call the shots," Horner says.
As the new kids on the block, the Paxtons' anonymity proved difficult, and they sometimes left the table empty-handed. …