The Washington Post Company completed the divestment of its newspaper publishing businesses to Jeffrey P. Bezos, founder of Amazon.com Inc. for $250 million. The sell-off, which includes the flagship newspaper ‘The Washington Post’, comes as a major development amid bleak economic conditions.
Alongside The Washington Post, the Express newspaper, The Gazette Newspapers, Southern Maryland Newspapers, Fairfax County Times, El Tiempo Latino and Greater Washington Publishing have been sold.
The purchase was made in individual capacity by Mr. Bezos, and did not involve Amazon.
The Washington Post Company has been in troubled waters owing to its publishing business, which has been combating sinking revenues. Alongside, waning advertising demand has been taking a toll on the company’s performance.
In fact, the publishing industry as a whole has been struggling with sinking advertising revenues and declining circulation as more and more readers are gradually choosing online news, thereby making the print-advertising model increasingly irrelevant.
In order to survive, most of the publishing companies are slashing costs or shedding their publishing assets or moving away from sagging publishing business.
The New York Times Company offloaded its New England Media Group, including The Boston Globe and its allied properties for $70 million. This resulted in a massive loss for The New York Times Company, which had paid a mammoth amount of $1.1 billion to acquire The Boston Globe newspaper in 1993.
Formed in 1877, The Washington Post Company will now focus on its education business and is making efforts to diversify into other lines of businesses. The company in Jul 2013 announced the acquisition of Forney Corporation, a supplier of products and systems for power and industrial boilers, from United Technologies Corp. . It also acquired Celtic Healthcare Inc. – a company engaged in home healthcare and hospice services in the northeastern and mid-Atlantic regions.
Currently, The Washington Post Company carries a Zacks Rank #3 (Hold).