Following an industry trend, Gannett announced on Tuesday that it intends to split its company in two. One half will handle the newspapers and the other its broadcasting and digital operations.
The AP reports:
"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.
"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."
Shares of Gannett, the AP adds, surged on the news, "hitting levels not seen since early 2008."
In a statement, Gracia Martore, Gannett's president and chief executive officer, said the move will give both companies "enhanced strategic, operating, financial, and regulatory flexibility to pursue growth and consolidation opportunities in their respective markets."
Along with the news, Gannett also announced that it had agreed to buy the remaining shares of Cars.com for $1.8 billion in cash.