You can forgive your local Pioneer Press employee for being a little nervous today. The sale of his/her newspaper appears at hand.
Reuters reports that Apollo Global Management LLC is the front runner to buy Digital First Media for $400 million.
It’s a buyout firm, which means they’re not that interested in great journalism; they’re interested in squeezing out some profit by cost cutting.
“Apollo, a distressed investment player (is) known for playing tough,” Forbes said in a profile last year.
“The problem is that there is not a lot of cutting you can do without further reducing the quality of the product,” media analyst and former Pioneer Press managing editor Ken Doctor tells the San Jose Mercury News.
“They’ll be looking at how they can hold onto advertisers and customers while reducing expenses as much as they can. The reason they have to cut is that print advertising continues to go down about 7 to 8 percent a year,” he said.
He said if the company wins the bidding for the corporate owners of the Pioneer Press and 75 other newspapers, it would likely consider cutting the number of days it publishes a newspaper.
Last September, the union at the Pioneer Press took out a full-page ad in the Star Tribune calling on Digital First to sell the Pioneer Press.
The company has been trying to unload its real estate in downtown St. Paul for two years, without success.
A little trivia here: Leon Black, the founder of Apollo, owns Edvard Munch’s The Scream (fourth version).