Road warriors
New Media-Gannett duo off to sell deal
MICHAEL
Reed, the chairman and CEO of New Media Investment Group, hit the road Tuesday to convince investors that they should stay the course as he tries to merge New Media’s Gatehouse Media with USA Today owner Gannett Corp.
The merger, announced Aug. 5, has gotten off to a rocky start, including opposition from private equity firm Alden Capital.
In the roadshow presentation that the company filed with the SEC before markets opened Tuesday, Reed predicted the stock price of the combined companies could end up in the $18to-$24 range.
The slides say New Media, which has been trading under $8 a share in recent days, has traditionally traded at six to seven times earnings before interest, tax, depreciation and amortization.
But at the low end of a 4.5 times Ebitda, the combined company would yield a stock price of $18 a share. If it reaches the higher end and trades at 6.5 times Ebitda, that translates into a $30 stock price.
Reed also said the combined company will have $4.4 billion in revenue out of the gate. Interestingly, the filing with the SEC did not mention any newspapers sales, but it does mention “monetizing real estate,” which one source close to the situation said could bring in up to $250 million.
The company said it expects to achieve $275 million to $300 million in “synergies,” which The Post has previously reported.
New Media also acknowledged for the first time that it will have to spend $30 million a year over the next two years to achieve those synergies — accounting for buyouts and various other costs.
There was no mention of how many jobs would need to be cut, but the company seemed to zero in on printing, production, tech and headquarters personnel — not newsroom journalists.
Reed emphasized that the $1.8 billion loan from Leon Black’s Apollo Global Management is a “bridge loan” with few covenants attached and that it can be renegotiated without penalty in two years.
The company is predicting flat revenue but a big boost to Ebitda, which the company says will rise fromm $515 million at the outset to $860 million in two years as savings are realized, costs are cut and digital grows at a 40 percent clip to offset print declines.
As of Tuesday, New Media’s stock closed down 0.5 percent, to $7.93 — or below the $8-a-share threshold that some investors say is the minimum needed to entice shareholders to do the deal.
USA Today publisher Gannett actually saw a tiny uptick to close up 3 cents, to $9.84 a share, on Tuesday.
But the two companies still have a lot of ground to make up before shareholders vote on the deal in November.
On the day that the deal was announced, Gannett opened trading at $10.60 a share and New Media at $10.62 a share. Hard knocks at Vox
Carlos Maza, the controversial host of the show “Strikethrough,” appears to be on the way out at Vox Media.
Maza was engaged in a battle with right-wing provocateur Steven
Crowder, who the openly gay Latino Maza says has been attacking him with rants he considers racist and homophobic.
Maza pressured YouTube in June to take down Crowder’s video channel as hate speech. At first, YouTube refused to take down the channel, saying it did not violate YouTube guidelines, but then relented and agreed to “demonetize” the site but not to totally ban it.
Maza has also had Tucker Carlson in his crosshairs.
“Tucker Carlson is a white supremacist and YouTube profits from hate speech,” he tweeted. Maza’s twitter handle reads, @gaywonk. Initially, sources said, Vox executives had supported him in his battle with Crowder. But as Maza wanted to escalate the all-out war, their support seemed to wane.
Attempts to reach Maza via e-mail were unsuccessful, although he posted on Twitter, “hello from the ~shakiest~ few weeks of my life” on Aug. 11.
That triggered this response from one of his fans, Shannon P. Duffy.
“Hear the voices of your legions of fans. We value your voice. You are our warrior. We love and need you. The shrapnel of haters cannot pierce the armor we give you. Trust in this.”
Vox Media did not return calls seeking comment. But one source said Maza is negotiating a severance package.