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Episode 267 of “E&P Reports” – A Vodcast series hosted by Mike Blinder
As the local news industry evolves, mergers and acquisitions (M&A) remain crucial to its future. While challenges persist, opportunities for strategic growth and sustainability are expanding for both buyers and sellers.
In this discussion, Sara April, president of Dirks, Van Essen & April, and John Thomas Cribb, director of Cribb & Associates, share their insights into current trends in media valuations, the impact of digital transformation, and key strategies for those looking to buy or sell media organizations.
Stable valuations in a shifting landscape
One of the biggest takeaways from 2024 is that media valuations have remained stable despite economic uncertainties. The industry, which faced major disruptions during COVID-19, has since leveled off, and transaction values have followed suit.
“We are seeing valuations hold steady since coming out of COVID,” April said. “The valuations in 2024 have remained consistent with 2023, and we expect that trend to continue into next year.”
Cribb explained that a key factor in valuation is how embedded a newspaper is within its local community. When a paper has maintained its franchise and deep community ties, it can command a stronger valuation. “That’s what drives its valuation to be as high as possible,” he said.
The role of digital transformation in M&A deals
With digital transformation reshaping news publishing, buyers continue to evaluate its impact on acquisitions. While some view digital innovation as a key component of future revenue growth, others remain focused on the core fundamentals of local journalism.
“It really depends on the buyer,” Cribb said. “Many buyers want to see progress in the digital space, but they also have their own strategies. They may see digital as necessary but also want to implement their own game plan.”
April noted that digital subscription models play a role in decision-making for certain buyers. “Some buyers look at digital-to-print subscription ratios as a key factor before pursuing a deal,” she said. “Others, however, see an opportunity to bring their own strategy into place and grow digital revenue.”
While digital growth is important, it is rarely a deal-breaker. Many buyers focus more on core audience engagement and revenue stability rather than digital experimentation.
Who’s buying? The changing face of media acquirers
The pool of media buyers continues to evolve, ranging from major media groups to independent local entrepreneurs. In 2024, Carpenter Media Group emerged as the largest acquirer, following a trend of single dominant buyers in previous years, such as CherryRoad Media, Paxton Media and Adams Publishing Group.
“There always seems to be one company that does the most deals in a given year,” April said. “Once they absorb those operations, another group rises to the forefront.”
Beyond large corporate buyers, private equity firms remain active, while local entrepreneurs and strategic buyers — who purchase newspapers near their existing operations — are playing an increasing role.
“We’re seeing independent local buyers stepping in because they recognize the community value of these publications,” Cribb said. “They want to sustain them, not just treat them as financial assets.”
Why are owners selling? Understanding seller motivations
The motivations behind selling a media company vary widely. For some, it is a natural transition due to retirement, while others seek to rebalance their portfolio and reinvest in other markets.
“A common scenario we see is family-owned newspapers where the next generation isn’t interested in running the business,” Cribb said. “In those cases, owners start looking for a buyer who will preserve their legacy.”
Portfolio balancing also plays a significant role. “Some companies want to exit certain markets and reinvest in others,” April explained. “This strategy allows them to focus on core strengths while divesting properties that may no longer align with their goals.”
In some cases, media owners pivot entirely away from newspapers. Cribb recalled a recent example: “We sold the Dirks family newspapers a couple of years ago. They decided newspapers were no longer their future, so they transitioned their entire portfolio into light manufacturing. It was a great decision for them.”
Economic climate: A non-issue for M&A?
Despite ongoing discussions about economic uncertainty and inflation, April and Cribb agreed that the media M&A market remains largely unaffected.
“There really hasn’t been an economic slowdown affecting deals,” Cribb said. “We’re stable. The slowdown during COVID was industry-wide, but since then, things have rebounded.”
April echoed this sentiment, indicating continued strong deal flow in 2024 and beyond. “The economic climate has not negatively impacted transactions,” she said. “We had a strong 2023, which continues to be strong into 2025.”
With advertising revenue stabilizing and subscription models growing, the market remains healthy — an encouraging sign for those considering a sale.
Preparing for a future sale: What owners need to do now
Preparation is key for owners thinking of selling in the next few years. Cribb’s primary advice is simple but essential: clean up financials.
“It sounds simple, but clear, accurate financials are critical for both running a business and selling it,” he said. “You need financials that make sense, help you make informed decisions, and that buyers can trust.”
April added that maintaining strong top-line revenue is just as important. “Buyers care more about revenue than profit margins because they have their own expense structures,” she said. “Keeping revenue strong will make your company far more attractive.”
Cribb emphasized the importance of maintaining strong community relevance for those not yet ready to sell. “The most valuable media companies are the ones that matter to their communities,” he said. “That’s what ultimately drives long-term success.”
The secret to longevity: Just do your job
For publishers looking to navigate industry changes, the best strategy is often the simplest: focus on strong journalism and community engagement.
“There’s no room for complacency anymore,” April said. “Thirty years ago, the news business ran itself. Today, you have to work at it every day — engaging your audience, building relationships and producing strong content.”
Cribb agreed, adding that the key to success is retaining a strong team. “The companies thriving right now are the ones with strong teams doing their jobs,” he said. “Find and retain good people; that’s the best investment you can make.”
Ultimately, there’s no secret formula — just consistent, high-quality work and a focus on building relationships with readers and advertisers.
The road ahead for media M&A
As the news industry evolves, the M&A market remains strong, with steady valuations and buyers actively seeking opportunities. Understanding local relevance, digital opportunities and strategic portfolio balancing is key for those looking to buy.
For potential sellers, ensuring clean financials, strong revenue, and community engagement will help maximize valuation. “We expect stability to continue into 2025,” April said. “And for the right publications, opportunities remain strong.”
Cribb summed it up: “The winners in this industry are those who stay true to their communities, adapt and do their job well.”
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