• by September 9, 2019

If you want some insight into the current state of publisher dealmaking, a government filing for the planned $1.4 billion merger between GateHouse Media and Gannett has plenty of details from their talks.

A 16,000-word account of the seven-month negotiation is available at the website of the Securities and Exchange Commission.

Much of the negotiation focused on reaching a bid that Gannett’s board would accept, given that it fended off a hostile takeover from MediaNews Group, which was backed by a hedge fund.

What’s more interesting is the future revenue estimates for each publisher. The numbers suggest the combined company will have to really squeeze out costs as revenue slides.

Gannett forecast that as a standalone company, its revenue would shrink 2.9% from $2.79 billion this year to $2.17 billion by 2023. New Media estimated a 3.3% drop in revenue from $1.61 billion this year to $1.54 billion by 2023.

Combining forces won’t help their revenue growth, the forecast shows.

The estimate suggests that advertisers won’t boost their media purchases from a publisher with even bigger scale. The combined company will publish more than 260 daily newspapers and more than 300 weeklies.

Perhaps Paul Bascobert, who will be CEO of the new Gannett, will have more ideas on generating other sources of revenue, aside from advertising, based on his experience at The Knot wedding site. The Knot not only sells ads, but also earns revenue from affiliate sales, digital storefronts and ecommerce.