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ARKANSAS NEWSPAPERS PLAN JOINT VENTURE

Friday, September 4, 2009 12:40 AM CDT

STEPHENS MEDIA

SPRINGDALE — Stephens Media LLC, owner of The Morning News of Northwest Arkansas, and WEHCO Media Inc., owner of the Arkansas Democrat-Gazette, announced Thursday plans to combine their newspaper operations in Northwest Arkansas and operate as a single company.

The proposed joint venture between the two companies is under review by the U.S. Department of Justice and comes on the heels of significant financial losses in Northwest Arkansas in recent years reported by both organizations, according to a press release issued Thursday by the two.

Each company has scaled back pages, reduced employee benefits and required staff to take furloughs as cost-cutting measures during the lengthy recession. Despite their efforts, their operations in Northwest Arkansas continue to operate at deficits, according to the release.

If approved, a new company will be formed with both parties owning a 50 percent stake and contributing their Northwest Arkansas assets to the venture. Those assets include: Benton Daily Record, Northwest Arkansas Times, the northwest edition of the Democrat-Gazette, The Morning News, Hawgs Illustrated as well as weekly newspapers, real property, plants and equipment owned in this region.

Stephens Media will control the editorial content of the local daily and weekly papers owned by the new company.

The Democrat-Gazette will control the advertising, business, production and circulation functions of the new venture and the editorial content of the Democrat-Gazette’s Northwest Arkansas edition, which began 10 years ago.

At the request of the Justice Department, Stephens Media has agreed to pursue a sale of The Morning News separately as a daily newspaper in competition with the Arkansas Democrat-Gazette and other media outlets.

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