NEW YORK – Executives from Belo Corp. (NYSE: BLC), the Dallas-based media giant, visited the Big Apple today for an investors’ conference during which they shared details of the plan to spin off of the company’s newspaper and related businesses into a new public company, to be called A.H. Belo Corp.
The new company would own and operate three daily newspapers – Belo’s flagship Dallas Morning News, The Providence Journal Co. and The Press-Enterprise of Riverside Calif.; plus a variety of specialty publications targeting young adults and the Hispanic market; and the Web sites serving those publications. Together, those businesses have a current weekly audience of more than 3.8 million and annual revenue of about $740 million, the company said.
“As we begin 2008, we are confident that Belo’s industry-leading initiative to create separate newspaper and television companies will allow us to focus more narrowly and efficiently on our two discrete businesses,” said Robert W. Decherd, Belo’s chairman and CEO, who also will serve as chairman, president and CEO of the new company.
“This transaction will provide shareholders with greater insight into each business, allowing investors to make decisions most appropriate for their portfolio. In the long term, we believe that Belo Corp. and A.H. Belo will be better positioned as stand-alone companies, each possessing outstanding assets in highly-attractive markets capable of supporting future growth and innovation, which will lead to greater shareholder value creation.”
The Belo board of directors has approved a Jan. 25 record date for the split, and a dividend distribution ratio of 0.20 A.H. Belo shares for each share in Belo Corp.
The distribution will be tax-free to shareholders for federal income-tax purposes, though any cash received in lieu of fractional shares will still be taxable, the U.S. Internal Revenue Service said in a recent private ruling.
The split – slated for Tuesday, Feb. 8 – will create about 17.6 million shares of Series A common stock and 2.9 million shares of Series B stock in the new A.H. Belo Corp, the company said. A.H. Belo’s Series A shares are to begin trading on the New York Stock Exchange on Friday, Feb. 11, under the ticker symbol AHC, but the new company’s Series B shares will not be listed on any exchange. (Series A common stock in Belo Corp. will continue to trade on NYSE as BLC, the company said.)
“A.H. Belo will start out with an unlevered balance sheet, unique niche products, and strong print and online assets in attractive growth markets,” Decherd said. “Our newspapers are experiencing growth in total audience reach and readership.”
Belo Corp. (NYSE: BLC) is a diversified media company whose properties include television, cable, newspaper and interactive media assets. A member of the Fortune 1000, it has $1.6 billion in annual revenue and employs 7,000 people nationwide. To learn more, visit www.belo.com.
