• by Erik Sass  @eriksass1, January 4, 2016

There aren’t many people who can lift the spirits of a flagging industry all by themselves, but Warren Buffett is one of them.

On New Year’s Eve, BH Media Group -- the newspaper division of Buffett’s investment conglomerate Berkshire Hathaway -- announced the acquisition of another small newspaper, signaling the continued confidence of the "Oracle of Omaha"in the long-term viability of local news media as a business.

On Thursday evening, BH Media Group announced the acquisition of The Free-Lance Star of Fredericksburg, Virginia -- with a daily circulation of 31,700 -- from Sandton Capital Partners, an investment firm that specializes in distressed properties.

Terms of the deal -- which also includes the newspaper’s associated printing operation, Print Innovators -- were not disclosed. Sandton originally acquired the newspaper in June 2014 during bankruptcy proceedings.

The acquisition of The Free Lance-Star brings BH Media’s portfolio to 32 daily newspapers, as well as dozens of other publications – many of them serving small and mid-sized communities. However, in Virginia, it also owns one of the larger regional dailies, the Richmond Times-Dispatch, as well as Richmond.com 

As noted, BH Media’s string of newspaper acquisitions is a vote of faith in the beleaguered business at a time when many have voiced doubts about its future. Back in March 2013, Buffett explained his thinking in his annual letter to BH investors, noting that while newspaper profits will probably decline for the foreseeable future, in the long term, their position as sole providers of local news will ensure their continued existence and vitality.

Buffett stated: “Newspapers continue to reign supreme, however, in the delivery of local news. If you want to know what’s going on in your town -- whether the news is about the mayor or taxes or high school football -- there is no substitute for a local newspaper that is doing its job… Wherever there is a pervasive sense of community, a paper that serves the special informational needs of that community will remain indispensable to a significant portion of its residents.”

Buffett further predicted that “papers delivering comprehensive and reliable information to tightly-bound communities and having a sensible Internet strategy will remain viable for a long time. We do not believe that success will come from cutting either the news content or frequency of publication… Our goal is to keep our papers loaded with content of interest to our readers and to be paid appropriately by those who find us useful, whether the product they view is in their hands or on the Internet.”