MERCER COUNTY AREA
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Buyer also owns daily newspapers in New Castle, Meadville
The transaction is expected to close by March 29.
"I thank John Lima and all of the employees of The Herald for their many years of dedicated work for this newspaper and the many communities that it serves. I am very proud of what they have accomplished," said James H. Ottaway Jr., chairman of the board of ONI.
"I am very pleased that Community Newspapers will be the successor owner and publisher of this newspaper because it is led by real newspaper people who emphasize local news and public service and will protect the local independence of this newspaper."
Mike E. Reed, president and chief executive officer of CNHI, said, "We are very happy to add these outstanding newspapers to the CNHI family. We anticipate no changes to the daily operations of the newspapers and look forward to continuing the tradition of serving their communities and customers."
Lima, who has been president and publisher of The Herald since 1993, said he is looking forward to working with the newspaper's new owners.
"We've enjoyed our more than 30 years of being a part of the Ottaway family. We anticipate a healthy and long-term relationship with CNHI. Our philosophy of local news first, steeped in the tradition of The Herald's 137 years of serving the Mercer County area, will continue to be our guiding principle.
"Our goal has always been to satisfy the many and diverse needs of our loyal readers and advertisers. CNHI and The Herald share that common goal, and we will continue to produce a quality newspaper dedicated to satisfying those needs," Lima said.
CNHI, formed in 1997, is the parent company for daily, weekly and semiweekly newspapers published in more than 200 communities throughout the United States. CNHI owns 105 daily newspapers, including the nearby New Castle News and the Meadville Tribune, and 77 nondaily newspapers in 21 states with a daily circulation of more than 1.1 million.
The Herald's history dates back to the Civil War era.
Founded by two brothers, R.C. and James Frey, the first edition was rolled out on April 14, 1864, under the name The Sharon Weekly Herald.
The newspaper underwent a series of owners and was published as a weekly until April 12, 1909, when it became a daily paper publishing Monday through Saturday.
The Herald later merged with the News-Telegraph, a competing newspaper. The first issue of the combined Herald was published on May 13, 1935, under the name The Sharon Herald.
The paper was under local ownership until it was sold to Ottaway on June 30, 1971. It was about that time the paper's name was changed to The Herald.
Other Ottaway newspapers involved in this sale are The Free Press in Mankato, Minn.; The Daily Independent in Ashland, Ky.; and The Globe in Joplin, Mo. The deal, valued at $182 million and subject to regulatory approval, also includes the weekly Allied News in Grove City and The Hubbard Press.
For the full year 2001, the four daily newspapers had combined revenues of $47 million and operating income of $12 million. They had combined circulation of 96,200 in January.
"After a review of all Ottaway newspaper locations, we have decided to focus our future growth outside of these markets and to aggressively pursue newspaper acquisitions in other regions of the country," Ottaway said.
After the sale, Ottaway will publish 15 daily and more than 30 weekly newspapers in 10 states. It is a wholly-owned subsidiary of Dow Jones and Co. Inc., publishers of The Wall Street Journal.
Dow Jones anticipated using available capital loss carryforwards to offset the cash sales, resulting in an after-tax gain of about $118 million, or $1.39 per diluted share, and after-tax proceeds of $165 million. Proceeds will be used to repay debt, repurchase shares and acquire additional community newspapers, the company said.
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