Magazine article Editor & Publisher

CNHI's Y2K Plan: Start Buying Again

Magazine article Editor & Publisher

CNHI's Y2K Plan: Start Buying Again

Article excerpt

You'd better not pout, small-town publisher, Santa Claus is coming to town. Ralph Martin, founder of Community Newspaper Holdings Inc. (CNHI), says his Birmingham, Ala.-based chain - which spent 1.1 billion dollars to grow from zero papers to 95 dailies and 100 paid weeklies in its first two years of existence - expects to be back in the acquisition chase in December.

"We believe we're only about one-half invested. We're going to get back into the acquisition business," Martin said.

CNHI has been quiet since the beginning of the year as it has tried to digest the accelerating purchases that followed its launch in February of 1997 with an old business plan developed by Martin and Chief Financial Officer Mike Reed - and a 1.3-billion dollar investment from the Retirement Systems of Alabama (RSA).

"Frankly, we just crushed our accounting office," Martin said.

Martin could hardly have found a more receptive audience for his comments than the members of the Inland Press Association. Many at the Oct. 25-26 annual meeting in Chicago own exactly the kind of paper that has made CNHI a phenomenon of growth: small to mid- size, located in the heartland or Dixie, and capable of producing much bigger margins when clustered with similar properties.

"Have you ever thought of going into California?" one executive asked plaintively at the annual meeting in Chicago. The answer was no.

"We want to be in good markets with bad newspapers," Martin said. What he means, he said, are newspapers that are not now achieving margins on gross revenue of 22 to 29 percent. …

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