Proposed Merger With Gannett

12 Months Ended

Dec. 31, 2015

Business Combinations [Abstract]

Proposed Merger With Gannett

PROPOSED MERGER WITH GANNETT

On October 7, 2015, we entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Gannett Co., Inc. (“Gannett”) and Jupiter Merger Sub, Inc., a wholly owned subsidiary of Gannett (“Merger Sub”). The Merger Agreement provides that, subject to the satisfaction or waiver of specified conditions, Merger Sub will merge with and into us and we will become a wholly owned subsidiary of Gannett (the “merger”). If the merger is completed, our shareholders will receive $12.00 in cash, without interest and less any applicable withholding taxes (the “Merger Consideration”), for each share of our common stock owned. In addition, under the Merger Agreement all of our unvested restricted stock units outstanding immediately prior to the effective time of the merger will become vested, and, as a result, such restricted stock units will become shares of our common stock that will be converted into the right to receive the Merger Consideration.

This transaction was unanimously approved by the boards of directors of both companies and was also approved by our shareholders (Gannett’s shareholders are not required to vote on this transaction). The closing of the merger remains subject to customary closing conditions, including antitrust regulatory clearance. We and Gannett are continuing to work through the review process with the U.S. Department of Justice and look forward to closing the transaction on a timely basis.

ACQUISITIONS

On April 1, 2015, we completed the acquisition of JRN Newspapers by issuing 9,928 common shares to Journal shareholders in exchange for their interest in JRN Newspapers. The purchase price of $87,362 reflects the fair value of the common shares issued to Journal shareholders based on the closing market price of our common stock on the acquisition date.

The fair values of assets acquired and liabilities assumed for JRN Newspapers are preliminary based upon all information available to us at the present time and are subject to working capital and post-closing adjustments and are as follows:

	JRN Newspapers
Cash	$	10,489
Receivables	12,359
Prepaid expenses and other current assets	5,101
Property, plant and equipment	74,376
Intangible assets	9,600
Goodwill	9,157
Other assets	688
Total assets	121,770
Current liabilities	23,751
Long-term liabilities	10,657
Total liabilities	34,408
Total purchase price	$	87,362

The intangible assets are trade names with an amortization period of 25 years.

Goodwill of $9,157 arising from the acquisition is attributable to cost and revenue synergies expected to be realized. The goodwill which we acquired is not subject to amortization for financial reporting purposes, but is expected to be entirely deductible for income tax purposes. Goodwill and current liabilities increased $127, from amounts previously reported in our September 30, 2015 Form 10-Q, for certain liabilities due to Scripps per the master transaction agreement.

Transition and integration related costs with respect to the foregoing transaction were $7,616 for the year ended December 31, 2015, and are included in selling, general and administrative expenses in the Consolidated and Combined Statement of Operations.

The acquisition has been accounted for under the acquisition method of accounting, which requires the total purchase price to be allocated to the assets acquired and liabilities assumed based on their estimated fair values, which is a level 3 valuation in the GAAP valuation hierarchy. A level 3 valuation includes pricing inputs that are unobservable for the asset or liability and include situations where there is little, if any, market activity for the asset or liability. The excess purchase price over the amounts assigned to tangible and intangible assets acquired and liabilities assumed is recognized as goodwill. The operating results and cash flows of the acquired business are included in our consolidated financial statements from April 1, 2015, the effective date we acquired control of JRN Newspapers.

JRN Newspapers contributed revenue of $100,486 and net earnings of $4,348 for the period from April 1, 2015 to December 31, 2015. The following pro forma information presents the combined results of operations as if the acquisition of JRN Newspapers had occurred on January 1, 2014:

	Twelve months ended December 31,
Pro Forma Results of Operations	2015		2014
Revenue	$	474,967	$	517,896
Net earnings (loss)	$	9,704	$	(25,319	)
Earnings (loss) per share, basic and diluted	$	0.39	$	(1.04	)

The pro forma results reflect certain adjustments related to the acquisition. The 2015 pro forma revenue and net earnings (loss) were adjusted to exclude the $1,257 revenue ($754 after-tax) reduction related to the fair value deferred revenue valuation. The 2015 results also exclude $4,570 in after-tax transition and integration costs. The 2014 pro forma revenue was adjusted to include the $1,257 revenue reduction related to the fair value deferred revenue valuation. The 2014 results include $4,570 in after-tax transition and integration costs. The pro forma results exclude any planned revenue or cost synergies or other effects of the planned integration of JRN Newspapers. The pro forma results are for comparative purposes only and may not be indicative of the results that would have occurred if we had completed this acquisition as of the date indicated above or the results that will be attained in the future.