VV group: Going once, going twice, it's gone!
The Village Voice - the original alternative that became a model for a new irreverent newspaper genre - has since become the flagship of a fleet of alternative weeklies.
Now, with its announced sale to investors who plan to buy more weeklies and expand the group's brand name, the Stern Publishing chain may start looking still more like its mainstream brethren.
Stern President David Schneiderman, who will become CEO of the new company, to be called Village Voice Media, insisted that the papers won't stray from their roots,
however. The investors will maintain hands-off ownership, and the New York-based Voice's existing management, including Editor in Chief Donald Forst, will stay in place.
"I'm still here," said Schneiderman, who also will be an investor in the group. "Hopefully, we'll get better."
The buyers, led by the investment firm Weiss, Peck & Greer, last year bought part of the alternative Nashville Scene in Tennessee, which will become part of Village Voice Media. They also are in a group that signed a letter of intent to buy Ace Magazine, a biweekly in Lexington, Ky.
One of their first moves, however, was to close the Voice's Long Island, N.Y., counterpart, which failed to turn a profit since its founding three years ago.
Long-term, the plan is to add alternatives and possibly radio stations, and extend the weeklies' brands via cross promotion on the radio and the Internet. Two investors, Liberty Broadcasting owners Jim Thompson and Mike Craven, will help with the radio strategy. Arthur Howe, former publisher of the Philadelphia City Paper, an alternative owned by Montgomery Newspapers Inc., will be president of the new group.
Schneiderman said he envisions turning the weeklies' Web sites, now updated weekly, into around-the-clock news sites. "It is sort of a paradigm change for reporters," he said. "It's multiple channels we have to think about."
Alternatives are a relatively fast-growing part of the newspaper industry. These weeklies, which once wore the free-distribution label like a scarlet letter, have drawn national ads because of their popularity among the affluent 18- to 34-year-old readers targeted by marketers. As in the Stern case, investors tend to look for companies with growth potential and experienced management teams.
The Stern papers, plums in the industry, drew more than 10 would- be buyers, from print publishers to online companies to private equity firms.
Stern's big competitor, the alternative chain New Times Inc., reportedly was an unsuccessful bidder, to the relief of some in the industry who wanted to preserve competition. New Times has 11 papers with a circulation of 1.5 million; Village Voice Media will have eight papers with a circulation of about 900,000.
And to the relief of some inside the company, rumors that conservative press lord Conrad Black was after the group remained just that.
Financial terms of the deal, expected to close in February, were not released. But the chain reportedly was sold for about $155 million, which is close to double its annual revenues of about $80 million and is in the range of industry observers' estimates.
Weiss, Peck & Greer, with offices in New York, San Francisco, and Chicago, has $16 billion in assets. Other media holdings include Lionheart Newspapers, with 68 community papers in the South and Midwest that have 900,000 in total circulation.
The Stern group owns papers in Los Angeles, Cleveland, Minneapolis-St. Paul, Seattle, and Orange County, Calif., in addition to the Voice. It was built by pet food king Leonard Stern, who bought the Voice from Rupert Murdoch 14 years ago for $55 million. He put the group up for sale in September because his children didn't want to take it over.
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|Comment:||VV group: Going once, going twice, it's gone!|
|Publication:||Editor & Publisher|
|Date:||Jan 10, 2000|
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