Gannett is splitting its broadcast and publishing business in two, joining other major media players in allowing fast growing TV and digital operations to operate more freely and not be weighed down by the declining newspaper business.
The media company also announced Tuesday that it would take full ownership of Cars.com for $1.8 billion.
Shares of Gannett, which owns 46 TV stations, USA Today and 81 other newspapers and websites such as CareerBuilder, rose more than 3 percent in premarket trading.
The spinoff of the publishing unit follows similar maneuvers by other major operators like Time Warner Inc., News Corp. and the Tribune Co., which completed a split with its division that publishes The Los Angeles Times and other newspapers on Monday. Media companies have been taking action to separate sluggish newspaper operations from more profitable broadcast units, as the industry adapts to consumers' increasing taste for digital content.
CEO Gracia Martore said the "bold actions" will help increase value for shareholders "in today's increasingly digital landscape."
Last year Gannett acquired Belo Corp. for about $1.5 billion, almost doubling the number of TV stations it controls. Talk of a split was raised almost immediately as the broadcast division's dominance grew over the publishing wing, something that has happened across the media sector as digital media evolves.
Gannett Co. said Tuesday that the publishing business will basically be debt free once spun off, with the broadcasting and digital businesses holding the existing debt.
Gannett's broadcasting business now operates 46 television stations. The digital business includes websites such as CareerBuilder and will also now include Cars.com. The publishing company will house USA Today as well as 81 local U.S. daily publications and Newsquest, a regional community news provider in the U.K.
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