In an all-cash, take-private deal valued at $74.9 million, The Dallas Morning News announced Thursday that it has agreed to join the Hearst Corporation, whose national chain of 28 daily newspapers will soon include the dailies of Texas’ four most populous cities.
The sale includes all outstanding stock of The News’ holding company, DallasNews Corporation, and Medium Giant, its wholly owned marketing subsidiary.
In Texas, Hearst owns the Houston Chronicle and the San Antonio Express-News and, in February, announced its agreement to acquire the Austin American-Statesman from Gannett. Elsewhere in Texas, Hearst owns the Beaumont Enterprise, the Laredo Morning Times, the Midland Reporter-Telegram and the Plainview Herald.
In addition to its daily newspapers, Hearst owns and operates 50 weeklies across the U.S.
The sale price of $14.00 per share reflects a premium of 219 percent above the DallasNews closing price of $4.39 per share on July 9. Upon closing, DallasNews will cease trading on the Nasdaq.
Outside legal advisors on the deal include Haynes Boone for DallasNews and Clifford Chance for Hearst. Jeff Chapman of Gibson Dunn & Crutcher advised Robert W. Decherd, DallasNews’ majority shareholder and former chairman.
The Haynes Boone team advising DallasNews was led from Dallas by partners Jennifer Wisinski and Rosebud Nau, along with associates Joshua Reisman, Taylor West, Alexandria Pencsak and Ethan Moore.
J.P. Morgan Securities advised DallasNews on the financial aspects of the deal.
The deal ends nearly 100 years of continuous control by the family and heirs of George Bannerman Dealey, who purchased the newspaper in 1926 from the family of its founder, Alfred Horatio Belo. The company traces its own origins to the founding of the Galveston Daily News in 1842.
“For 140 years, The Dallas Morning News has earned enviable status as one of the most trusted and distinguished daily newspapers in the U.S.,” DallasNews CEO Grant Moise said in a statement. “We’ve done so by focusing on the issues that matter most to our North Texas community and by embracing the kind of objective, accountable and skillful reporting at the heart of impactful journalism.”
Jeff Johnson, president of Hearst Newspapers, stated, “Hearst Newspapers is committed to supporting The Morning News’ continued success through smart investments in their digital strategy, compelling journalism and expanded audience reach. This move aligns squarely with our strategy of backing trusted, high-impact local media brands in growth markets. We’re looking forward to working with the teams at The News and Medium Giant.”
The Texas Lawbook, the largest and most influential legal publication in Texas with more than 16,000 paid subscribers, expanded its reach into the Texas business community with a content partnership with The Morning News announced in October. The partnership provides substantive content about trends and developments in the legal industry to readers of The Morning News and the legal experts quoted in The Lawbook a larger, statewide audience to showcase their expertise and successes.
“This deal is a transformative moment for journalism and business news in Texas,” said Lawbook publisher Brooks Igo. “Adding The Morning News gives Hearst the unique ability to rapidly scale its audience and deliver high-impact journalism in one of the fastest-growing economies in the world. The Lawbook is proud to provide the latest Texas legal news for Morning News subscribers, as we have for the Chronicle previously.”
Decherd, a great-grandson of Dealey and former chairman of DallasNews, said in the announcement: “The News’ 140-year commitment to distinguished journalism has been extraordinarily important to the evolution of Dallas as one of America’s greatest cities. We have generations of News employees to thank for this. I’m confident that the path forward with Hearst Newspapers assures The News’ ability to continue informing and strengthening North Texas for many years to come.”
During Decherd’s ownership, The Morning News won nine Pulitzer Prizes.
On the deal, the Haynes Boone team also included: partner Don Shiman, counsel Danielle Marr and associate Annie Lawson on taxes; partner Susan Wetzel on benefits and compensation; partner Raquel Alvarenga and associateSean Lewis on labor and employment; partner Keenan Kolendo and associate Haley King Wentworth on real estate; partner Gavin George and associate Braden Davies on intellectual property and partner Mary Mendoza and counsel Victor K. Salazar on environmental issues.
Clifford Chance advised Hearst with a team led from New York by M&A partners Chang-Do Gong and Benjamin Sibbett and M&A counsel Christine Kim. The team also included Houston M&A partner Jon Bobinger with Houston partner Ty’Meka M. Reeves-Sobers and Houston associate Hannah Ebersole on environmental issues.