A.H. Belo, the Dallas-based owner of the Providence Journal, has hired an Arkansas-based firm to help explore a possible sale of the ProJo, newspaper employees were told during a meeting with publisher Howard Sutton Wednesday morning.
The company retained by Belo to explore a sale is Stephens, which bills itself as "a privately-held, independent financial services firm focused on building value for companies, state and local governments, institutions and high-net-worth investors."
Sutton told ProJo workers that prospective buyers include both newspaper chains and Rhode Islanders, although no specifics were offered, says metro columnist Bob Kerr. A sale is not expected to take place before next summer.
The news comes as the Journal has suffered ongoing losses in circulation and ad revenue, like its peers in the newspaper industry.
Kerr says his colleagues and he aren't surprised by the news that the ProJo is being offered for sale, in part since Belo recently sold the Riverside Press-Enterprise in California.
Kerr says that despite less than an hour's notice for the 9 am meeting Wednesday, the session was well-attended.
"There's a general feeling that the change could be good at this point," Kerr says. "Belo's obviously not putting a lot into the paper .... I think there's a certain strange optimism about it."
Kerr, who has worked at the Journal for decades, adds, "Somebody's who been around here as long as I have would like to see something good happen. The last few years have been very uncertain and I think it would be good for all of us to know for sure what the next five or ten years look like."
Just how much the Journal could sell for is uncertain. By way of comparison, The Boston Globe sold for $70 million earlier this year -- 20 years after The New York Times paid more than $1 billion for it.
Reporter John Hill, president of the Providence Newspaper Guild, hopes for a new owner that will move the ProJo past "these annual Halloween layoff horror shows we've been having here for the past few years. Maybe to get someone who's from the area who cares about the paper as a civic institution and will see it that way, because I think right now we've been owned by an outfit that has its priorities in other places, and it would be nice to have somebody who values the Journal for itself."
As far as possible local buyers, Hill says, "If there are serious people out there, this should flush them out. You know, it could be better, it could be the same, and it could also be worse."
In a news release, Belo says:
"This decision is part of the revised financial and operating strategies discussed in the Company’s third quarter earnings release. A sale of The Providence Journal would generate additional cash proceeds to potentially invest in or buy advertising and marketing services companies to grow and diversify revenues and to finance further share repurchases in the future. These funds may also be used for other general corporate purposes. Additionally, a sale of The Providence Journal would allow the Company to continue to focus resources and management time and attention on its core Dallas market. However, the Company cannot guarantee that an appropriate buyer will be located or that a transaction could be closed on acceptable terms and conditions.
"Jim Moroney, chairman, president and Chief Executive Officer, said, 'The Providence Journal is an important financial contributor to our Company, and the newspaper’s commitment to the citizens of Providence and Rhode Island is unmatched. However, with A. H. Belo’s focus on investing and growing in Dallas, it makes sense to explore this opportunity.' "
The company then known as the Belo Corporation bought the ProJo and the Journal company's nine television stations for $1.5 billion in 1997. Belo divided itself into two companies in 2007, with the newspaper entity known as A.H. Belo.
Before the sale to Belo, the Journal was locally owned by the Metcalf family, who considered the newspaper a public trust. The path to the loss of local control was set in motion both by broader industry trends (the wider desire of newspaper heirs to cash in) and the mysterious 1987 death of Journal publisher Michael Metcalf, who was killed in a bicycle accident in Westport, Massachusetts. The sale to Belo enriched those with a family stake in the Journal, even while drawing a sharp protest from some other family members.
The Journal and its bygone evening paper, the Bulletin, long dominated the news industry in Rhode Island. The newspaper helped pioneer the approach of using a series of external bureaus to cover statewide news, and the paper's journalism attracted national attention under such editors as Charles McCorkle Hauser and Joel Rawson. It last won a Pulitzer Prize in 1994, under the direction of Tom Heslin, who later succeeded Rawson as executive editor.
Yet a parade of talent away from the Journal began about 12 years ago, just as the threat posed by the Internet to legacy media was starting to become more present. In the time since, the paper has repeatedly cut its staff through a series of buy-outs and layoffs. Two members of the paper's former four-person investigative team, Mike Stanton and Tracy Breton, left earlier this year. Belo also offered the Journal's Fountain Street headquarters for sale in 2008.
A bitter four-year contract dispute that ended 10 years ago helped spark rumors about a possible sale of the Journal, and the late former governor Bruce Sundlun once made a run at buying the paper. Yet at least until recently, Belo saw the Rhode Island newspaper as a productive part of its portfolio.
This post has been updated.