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Montana: 406-586-6621 · Virginia: 434-971-8344 April 2010

Dear Newspaper Executive,

A number of our clients have asked about newspaper values as we move into spring,and we thought it timely to provide the valuation article below. Additional informationon all aspects of publishing company transactions is available on our website atcribb.com.

Current newspaper EBITDA valuationmultiples for mid and small marketpapers at 6x to 7.5xDistressed sales not indicative of current values

Some recent high profile newspaper saleshave created the impression that allnewspaper values are in the basement,which is completely incorrect. While EBITDAmultiples used to value newspapers are wellbelow those of a few years ago, the multiples

have not declined to the level of some distressed sales.

Let's say your neighbor loses his job and is unable to pay hishouse payment. The house goes into foreclosure and is soldfor 50 cents on the dollar compared to expected values. Doesthis mean that your house is worth half as much? Or toexpand that thought, does this mean that every house in theUnited States is worth half as much? Of course not - that sale

The Cribb GreeneTeam

CG&A Team

Contact Cribb Greene

"Our commitment is to dothe best possible job forour client in every aspectof our assignment every

time."

came out of a distressed situation, which reduced the sellingprice. Using a distressed newspaper sale as an example ofthe value of any and every newspaper is absurd.

Cribb, Greene & Associates has closed seventeen newspapertransactions between 2008 and the present - which isbasically the time period of the significant reduction innewspaper values. These transactions include mid and smallmarket daily, twice weekly, and weekly newspapers andclusters.

The average EBITDA valuation multiple in these transactions(excluding four properties that were losing money) was 7.58x.The most recent transactions (2009 to present) had anaverage EBITDA valuation multiple of 6.05x. The range ofmultiples of EBITDA in these transactions was 1.5x to 18.3x.Clearly, both the 1.5x transaction and the 18.3x transactionwere not typical. Seventy percent (70%) of these transactionswere at multiples between 5.5x and 8.6x.

Most of these transactions included some amount of sellerfinancing as conventional bank financing is still difficult toobtain, at least at terms deemed reasonable by newspaperbuyers.

No one can predict where newspaper values will go in thelonger term, but likely they will inch up and stabilize,particularly as bank financing becomes more available.Newspaper appraisals vary by market and publication, andmany factors affect value in addition to the multiple ofEBITDA. More distress sales will probably take place in thecoming year, but these sales do not set the value of allnewspaper properties.

Cribb, Greene & Associates Contact Information:

Montana office:John Cribb, Managing Director104 East Main, Suite 402Bozeman, MT 59715

Marketat a Glance

The market fornewspaper properties is

unsettled to say theleast, and prices rangefrom the value of realestate/hard assets to

EBITDA multiples of upto 8x. Saleability is a

question in manytransactions, as some

newspapers(particularly large,metro papers) may

remain unsold.

The lack of conventionalfinancing is the first

issue stalling the sale ofnewspaper companies.

Seller financing hashelped keep some deals

flowing, but has notbeen common in larger

deals - and can't beapplied to many

newspapers that carry ahigh debt burden.

Mid and small papers -both daily and weekly -are still selling with anumber of interestedparties in the buyer

pool. The transactionsare all over the place in

values, and creativedeal structures arebecoming the norm.

Phone: 406-586-6621 · Fax: 406-586-6774jcribb@cribb.com

Virginia office:Gary Greene, Managing Director1020 Ednam Center, Suite 001Charlottesville, VA 22903

Phone: 434-971-8344 · Fax: 866-776-8010ggreene@cribb.com

A transaction in the 4xto 8x recast EBITDA is

a sensible anddefensible financialapproach, however

some sales are belowthis range.

Cribb Greene Website

Newsletter PDF Archives

APPRAISALBROKERAGECONSULTING

Transaction:Fulton, New York

Valley News

Scotsman Press, one ofcentral New York's largestnewspaper and shopper

publishers as well ascommercial printers, has

acquired the Fulton-basedValley News as well as itscompanion publications,

The Valley NewsAdvertiser and The FultonPatriot, according to GaryGreene of Cribb, Greene

& Associates whorepresented the seller in

the transaction. Therecent acquisition was

completed February 3 andScotsman assumed

operations of the Fultonpublications Thursday,

February 4.

The Fulton newspapershad been owned and

operated for many yearsby Vincent Caravan and

his son Ronald. Thepapers had been in theCaravan family for 38

years prior to theownership transfer.

Transaction:NorthwestArkansas

Newspapers LLC

The publications ofNorthwest Arkansas

Newspapers LLC - theNorthwest Arkansas

Times, Springdale MorningNews, Rogers MorningNews, Benton County

Daily Record, Northwestedition of the ArkansasDemocrat-Gazette and

associated weekly papers- began their new

partnership Sunday,November 1, 2009.

The 50-50 joint venturebetween Stephens Media

LLC and the ArkansasDemocrat-Gazette Inc.was announced Sept. 3

after both parties reportedrevenue losses related to

higher newsprint costs andsluggish advertising salesand after an attempt hadbeen made by Stephensto sell their newspapers.The partnership follows adecade of head-to-headcompetition. The Justice

Department's investigationof the deal was completed

on Oct. 23, clearing theway to proceed. Cribb,Greene & Associatesassisted and advised

Stephens Media in bothits efforts to sell and

merge its newspapers.

Transaction:Roscommon, MI

The Houghton LakeResorter has purchased

assets of the RoscommonCounty Herald-News,

according to John Cribbof Cribb, Greene &Associates, who

represented the Perlbergfamily in the transaction.

The end of an eraaccompanies this issue ofthe Roscommon CountyHerald-News, but it alsosignals the beginning of

another.

The Herald-News willcease publication as of

this issue, publisherRobert Perlberg

announced. The effects ofthe recession on the

newspaper industry led to"a difficult decision that

had to be made," Perlbergsaid.

The Houghton LakeResorter will continue itsmission to provide all of

Roscommon County withcomprehensive news

coverage that has earnedthe paper a reputation asone of Michigan's leadingcommunity newspapers.

The Resorter has been

published continuously for69 years at HoughtonLake, and under the

ownership of the Hampfamily for 48 years. Robert

J. Hamp Jr. was thepublisher from 1961 to1982. Current Resorter

publishers are Thomas W.and Eric M. Hamp.

Transaction:Eagle NewspapersSyracuse, NY and

Albany, NY

Eagle Newspapers,Central New York's award-

winning communityweeklies and Spotlight

Newspapers, the CapitalDistrict's award-winning

weeklies were purchasedOct. 1, 2009 by

Community Media GroupLLC, according to Gary

Greene of Cribb, Greene& Associates, who

represented Eagle Mediain the transaction. Thetransaction includes the

sale of Eagle's eightweeklies in the Syracuse

market, and the sevenSpotlight weeklies in the

Albany market, as well asnumerous niche

publications and websites.

Transaction:Ironwood, MI

Bliss CommunicationsInc., parent company ofGlobe Publishing, LLC,

today announced the saleof the Daily Globe, locatedin Ironwood, Michigan, toa newspaper group based

in Sheridan, Wyoming.John Cribb of Cribb,

Greene & Associates,represented Bliss

Communications, Inc. inthe transaction.

Sidney H. Bliss, Blisspresident, and the new

owners made theannouncement to Globe

employees this afternoon.

Gary Stevenson, presidentof Stevenson newspapers,

and partner Garry Ellis,announced that Joe

Karius, former GeneralManager of Globe

Publishing, has beennamed publisher and

general manager of thenew operating company,which will be known as

Daily Globe, Inc.

Transaction:The Traders

Indiana, Kentucky,Tennessee

The Papers Inc. hasacquired 10 publications in

Indiana, Kentucky andTennessee from the

Trader Corporation ofCanada, according toJohn Cribb of Cribb,

Greene & Associates,who represented the

buyer in the transaction.

Ron Baumgartner,publisher of The Papers,

noted, "The TraderCorporation's several auto,truck and boat magazines,and the classified papers,

have done an excellent jobthrough the years. Wehope to build on theirsuccess in the coming

issues as we welcome thisgroup of publications to

our family of newspapersand magazines."

The acquisitions include:Indiana Trader Showcase,

Wheels & Deals-Auto,Trader Paper and

Peddler's Post; KentuckyCar & Truck; Tennessee

Trader Showcase, Wheels& Deals-Auto, Wheels &Deals-Truck, Wheels &

Deals-Boat, and Trader'sPost.

Transaction:The Trading Post

Chesapeake, VA andRichmond, VA

Dr. John S. deLeeuw,owner and founder of theTrading Post Publications

in Chesapeake andRichmond, Virginia, hassold his publications to

Lancaster Management,Inc. of Gadsden, Alabama,according to Gary Greene

of Cribb, Greene &Associates, who

represented the seller inthe transaction.

DeLeeuw co-founded theTidewater Trading Post in1963 while serving as a

business school professorat Dominion University.The company initiallyserved the Hampton

Roads area of Virginia andlater expanded into the

Richmond market with theMid-Virginia Trading Post

in 1969.

Transaction:The Sun

Green Bay, WI

Bay Media, LLC, asubsidiary of BlueLineMedia Holdings, has

acquired the assets ofGreen Bay Sun, LLC,

Green Bay, Wisconsin,including the weekly

direct-mailed shopperGreen Bay Sun, accordingto John Cribb of Cribb,Greene & Associates,who represented the

seller in the transaction.

Paul Seveska, presidentand chief executive officer

of BlueLine MediaHoldings, said the additionof the Green Bay Sun to

BlueLine Media's portfoliowould solidify the

company's ability to offercost-effective advertising

and marketing solutions tobusinesses in the growingnortheastern Wisconsin

marketplace.

Transaction:Three Daily Papers

Sayre, PA - Milton, PA- Oswego, NY

Transaction:The Daily Planet

Telluride, CO

Telluride's daily newspaper

Transaction:Sentinel & Advocate

Ripley, MS andAshland, MS

Journal Publishing Co.,publisher of the NortheastMississippi Daily Journal,

has acquired the SouthernSentinel in Ripley and the

Southern Advocate inAshland. The Southern

Sentinel has been servingRipley and Tippah County

since 1879 and theSouthern Advocate has

been serving Ashland andBenton County since

1904.

Tim Watson, publisher forboth newspapers, said,"I'm excited about thechange. We have a

talented staff, asevidenced by the 27editorial awards the

Sentinel and Advocatewon in this year'sMississippi PressAssociation Better

Newspaper Contest, andthe 30 MPA advertisingawards the two papers

won this year. The changewill allow us to continue to

offer the best possibleproduct to our readers in

Tippah and Bentoncounties."

Listen to Editor &Publisher

Magazine's MarkFitzgerald and

Jennifer Sabadiscuss theNewspaper

Operations Surveywith John Cribb onthe "Fitz & Jen GiveYou The Business"

Podcast Podcast

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