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Business/Economy

3 Alaska newspapers sold to GateHouse publishing group

The Georgia-based owner of several Alaska newspapers is selling the publications to the GateHouse newspaper chain.

Morris Communications announced Wednesday the sale of 11 newspapers across the country, including the Juneau Empire, Peninsula Clarion in Kenai and the weekly Homer News, to GateHouse Media.

Morris, based in Augusta, Georgia, said the sale is a "strategic restructuring" to focus its business on lifestyle publications and other areas. The sale also includes daily and weekly newspapers in Kansas, Texas, Arkansas, Georgia and Florida, along with Morris' commercial printing operations based in Lubbock, Texas.

GateHouse's parent company, New Media Investment Group Inc., said in a written statement Wednesday that it would spend $120 million on the newspapers and related assets.

"This transaction will expand our footprint into new states and add some very attractive markets to our local media portfolio," said New Media CEO Michael Reed.

Further consolidation in the newspaper industry "continues a trend that's been going on for awhile now," said Rick Edmonds, media business analyst at the journalism nonprofit Poynter Institute.

"The basic idea of the strategy from (New Media's) point of view is that scale helps with a variety of things," he said. "It's a way to sell ads over a wider network, a way to do a lot of things in a centralized way to save money. In a time when the financial pressures are pretty great, that's a strategy that makes some sense."

New Media and newspaper chain Gannett Co. Inc., are the two largest consolidators in the business, he added.

The newspaper industry across the country "saw a wave of consolidation between spring 2015 and spring 2016," a Pew Research Center report said last year. As of February, New Media had spent $735 million on newspapers in the last four years, according to the Nieman Lab.

Newspapers have suffered for more than a decade as more readers have shifted to consuming their news online. Circulation has dropped, as has advertising revenue, and the field is rife with layoffs.

"(E)very newspaper company in America is battling trends and redirected advertising dollars, so it is necessary for newspapers to be part of a large newspaper group to build and maintain the necessary resources to compete," said William "Billy" Morris III, chairman of Morris Communications, in a prepared statement.

Alaska Dispatch News is dealing with the challenges of the industry as well. ADN owner and publisher Alice Rogoff is "in discussions with several potential new investors" in the company, she told staff in an email last week.

"(W)e've been challenged by changing economic and financial circumstances, to say nothing of evolving news reading habits," Rogoff wrote. Deliberations with potential investors "are private and must be kept that way, so I cannot comment on their status. The goal is simple: to keep the state's major newspaper in the business of delivering both printed and digital news of, and for, Alaskans."

ADN is the largest newspaper and online news site in the state. In 2014, a young online news organization, Alaska Dispatch, announced plans to buy the bigger Anchorage Daily News for $34 million. At the time, the Daily News was owned by national chain McClatchy Corp.

Morris apparently will still have a presence in Alaska. The company owns the weekly Alaska Journal of Commerce, Chugiak-Eagle River Star and monthly Alaska magazine. Those publications were not included on the list of papers to be sold.

Heather Nagel-Doughtie, chief marketing officer for Morris, referred questions about the Alaska publications to Deedie McKenzie, publisher of the Clarion, Empire and Star. McKenzie did not return calls or an email seeking comment.

Morris purchased the Juneau Empire in 1968 and went on to acquire numerous Alaska publications and radio stations. The company purchased the Peninsula Clarion in 1990.

GateHouse Media owns 130 daily newspapers and more than 500 nondaily publications across the United States.

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