Gannett Snares $516 Million In Refinancing To Pay Down Existing Loan

Media giant Gannett Co., Inc. has entered into a $516 million senior secured loan facility and will use the funds, along with $400 million from a private offering, to repay an existing term loan.  

"This refinancing reduces our cost of capital by nearly 200 basis points, saving significant interest expense, while also improving upon the terms of our prior credit facility entered into in February 2021,” states Michael Reed, chairman-CEO of Gannett.  

Reed said since "the acquisition of legacy Gannett in November 2019, we have paid down $379 million of debt and reduced our cost of capital by 570 basis points.” 

The firm expects to “aggressively pay down debt, which will continue to reduce our annual interest expense and overall leverage,” Reed continues.  

When announcing it would seek such financing last month, Gannett reported it has repaid approximately $65 million in principal under its existing five-year term loan, thanks to the sale of real estate worth $38.6 million and other assets, bringing the loan principal down to $825.7 million.  

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The refinancing news comes as Nasdaq reports that Gannett stock has generated “a beautiful 309% return in just a single year. On top of that, the share price is up 25% in about a quarter.” 

But Nasdaq adds that “longe- term shareholders have had a tougher run, with the stock falling 62% in three years.”

Still, Gannett shares are now hot, given 17% revenue growth last year, despite the fact the company failed to make a profit, Nasdaq notes.

The recent improvement could “hint at a (positive) inflection point within the business, Nasdaq continues. 

In other Gannett-related news, the company has sold its Herald-Mail property in Hagerstown, Maryland, to the Hagerstown-Washington County Industry Foundation for $5 million.  
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