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December 07, 2005

Milking a Newspaper Company to Death

Dow Jones: Buyout firms weigh Knight Ridder deal. "It's a very attractive deal to finance with all of the recurring revenue from circulation and advertising, which would argue for a private-equity investment," said Robert Broadwater, head of the newspaper merger practice at New York media investment bank Veronis Suhler Stevenson. "The only issue is its residual value and who would take it off your hands in five years."

By the time the Wall Street barons and their minions get done, the auction block will be a chopping block. I grow more sad by the day watching a company I was proud to work for, at the Detroit Free Press (no longer part of the company) and San Jose Mercury News (which for years was the Bay Area's best newspaper), become fodder for such people.

No one is guaranteed business survival. But when newspapers get milked to death by people who think the public trust is a laughable concept -- certainly alien to "good business" -- we are all the poorer.

Posted by dymaxion at December 7, 2005 05:35 PM


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