Belo Acquires Providence Journal Co
IN YET ANOTHER example of how broadcasting is driving newspaper companies, A.H. Belo leaped into the big leagues of television with the $1.5 billion cash and stock purchase of the Providence Journal Co.
By newspaper industry standards at any time, the purchase of the 182,866-circulation Providence Journal -- a paper well-regarded for its editorial content, technological advances and market position -- by the publisher of the Dallas Morning News would be a blockbuster.
In the post-Telecommunications Act era, however, the deal was more than that -- and less about newspapers than TV.
While the Journal newspaper gives Belo its name and best-known media flagship, the TV stations account for about 80% of earnings before taxes, depreciation and earnings.
With its friendly takeover of Providence Journal Co's nine network-affiliated television stations added to its own seven stations, Belo will have 15 stations reaching 12.3% of the nation's viewer -- making it the tenth-largest TV operator in terms of viewership and the eighth when measured by revenues.
(Belo will acquire KING-TV, an NBC affiliate in Seattle, and KREM-TV, a CBS-affiliate in Spokane and so it will shed its current Seattle-Tacoma station, KIRO-TV, which runs UPN network programs, to satisfy Federal Communications Commission overlapping ownership regulations.)
"This combination of broadcast assets creates one of the finest network-affiliated station groups in the country," Belo's chairman and chief executive officer, Robert W. Decherd, said in a statement.
Belo has been in broadcasting since 1984. In addition to its Seattle/Tacoma station, the company operates network-affiliated stations that are first or second in their markets in Dallas-Fort Worth; Houston; New Orleans; Sacramento;Tulsa, Okla.; and Norfolk, Va.
Broadcasting already accounts for 49% of Belo's cash flow, so with its Providence acquisition, Belo is taking the same path another big traditional newspaper publisher,Tribune Co., took earlier this summer with its $1.13 billion purchase of Renaissance Communication Corp.'s 10 television stations.
When that deal is completed, broadcasting for the first time will be the biggest business at the company begun when Joseph Medill founded the Chicago Tribune 149 years ago. …