"Probably the most likely to be sold, it is the second-cheapest out of 10 U.S. publishers tracked by CapitalIQ, trading at a multiple of cash flow of 7.1 times. The cheapest is Tribune at 6.1 times and the industry average is 9.7 times. The trouble with the USA Today publisher is its size. Even though the stock has lost almost half its value in the past three years, Gannett has a market cap of $11 billion and more than $5 billion in debt. That is more than most media companies could afford, and it isn’t clear that the ones who could would want exposure to the industry."
Others on Deal Journal's list, in order, with the blog's handicapping notes:
- New York Times Co. A sale can't go through without permission of the controlling Sulzberger family, which has so far said it wants to keep the company independent.
- Washington Post Co. Family controlled. Also, shares are up 40% in the past five years, reducing pressure to sell.
- McClatchy. Its $2.7 billion in debt still outweighs its $2 billion market value. That could scare away bidders.
- Pearson. The Financial Times parent is more focused on bolstering its competitiveness than considering on any sale.
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