DALLAS--(BUSINESS WIRE)--Aug. 5, 2014--
A. H. Belo Corporation (NYSE: AHC) (A. H. Belo or the Company) announced
today that it, along with its partners in Classified Ventures, LLC (CV),
entered into a definitive agreement to sell its units in CV to Gannett
Co., Inc. for a price that values CV at $2.5 billion. The transaction is
expected to close before the end of 2014, subject to regulatory review.
Upon the close of the transaction, A. H. Belo will enter into a new,
five-year affiliate agreement with CV that will allow The Dallas
Morning News to continue to resell Cars.com products and services
exclusively in its local market. The affiliate agreement increases the
wholesale rate that A. H. Belo will pay to CV for selling Cars.com
products.
CV, whose primary asset is the online car shopping website Cars.com, is
a joint venture among A. H. Belo, The McClatchy Company, Tribune Media
Company, Graham Holdings Company and Gannett Co., Inc. A. H. Belo owns
3.3% of CV and estimates its pre-tax, cash proceeds net of selling costs
and funds held in escrow will be approximately $78 million. The funds
held in escrow of approximately $3 million are expected to be released
twelve months after the closing date of the transaction.
Jim Moroney, chairman, president and Chief Executive Officer of A. H.
Belo, said, “We have been able to monetize our investment in Classified
Ventures at a fair price and retain our ability to remain a reseller of
Cars.com products for the next five years, which is an excellent outcome
for our Company. We are very pleased that Gannett will own Classified
Ventures and be our partner as we continue to build
the Cars.com franchise in the greater Dallas area.
“The proceeds from this transaction will allow A. H. Belo to continue
with its strategy of investing in advertising and marketing services
companies to allow for revenue growth and diversification. As always,
the Company will balance investment opportunities with alternatives to
continue to return capital to shareholders.”
In the quarter the transaction closes, A. H. Belo expects to record a
gain of approximately $76 million on the CV sale. As a result of taxable
gains on the sales of Classified Ventures (including the gain from the
sale of Apartments.com), The Providence Journal newspaper
operations, the site of the former commercial printing operation in
Riverside, CA and land in southern Dallas, TX, the Company expects to
fully utilize its net operating loss and capital loss carry forwards
during 2014.
Moelis & Company LLC acted as exclusive financial advisor and Skadden,
Arps, Slate, Meagher & Flom LLP acted as exclusive legal advisor to A.
H. Belo Corporation, its selling partners and CV.
About A. H. Belo Corporation
A. H. Belo Corporation (NYSE: AHC) is a leading local news and
information publishing company with commercial printing, distribution
and direct mail capabilities, as well as businesses with expertise in
emerging media and digital marketing. With a continued focus on
extending our media platform, we are able to deliver news and
information in innovative ways to new audiences with diverse interests
and lifestyles. For additional information, visit ahbelo.com,
email invest@ahbelo.com.
Source: A. H. Belo Corporation
A. H. Belo Corporation
Alison K. Engel, 214-977-2248
Senior
Vice President/Chief Financial Officer
www.ahbelo.com
