- The Washington Times - Friday, January 4, 2008

NORFOLK (AP) — A family owned business that started with a local newspaper more than 100 years ago and became best known as owners of the Weather Channel is looking into selling its businesses, including the Annapolis Capital.

Frank Batten Jr., Landmark Communications Inc.’s chairman and chief executive, announced yesterday that the privately held company has retained investment banks JPMorgan and Lehman Brothers to help it look into possible sale scenarios.

“At this early stage, we cannot speculate on where this process will lead,” Mr. Batten said.

Landmark’s vice chairman, Richard F. Barry III, declined to say why a sale was being considered.

“This will all come out as this thing unfolds,” Mr. Barry said. “This is day one of a multimonth process.”

Mr. Barry said he did not know how much Landmark could make by selling its largest asset, the Atlanta-based Weather Channel, one of the nation’s last privately owned cable channels. Landmark previously has rebuffed offers for the channel.

Capital-Gazette Newspapers, which owns the Capital and other local publications, was bought by Landmark last year from Eleanor Merrill, who had owned the company with her now-deceased husband, Philip. The Capital has a daily circulation of about 45,000. Its sister publication, the Maryland Gazette, is published twice a week and has a circulation of nearly 30,000.

Capital-Gazette also publishes the Bowie Blade-News, the Crofton News-Crier, the West County Gazette, the South County Gazette and news site HometownAnnapolis.com. The company has 223 employees.

In private meetings yesterday, Landmark employees were told that a sale could be completed as soon as this summer, Landmark’s flagship newspaper, the Virginian-Pilot of Norfolk, reported on its Web site.

Mr. Batten told the paper that he made the decision to explore the sale, with input from his entire family. He has controlling interest.

Analysts estimated that the Weather Channel could fetch up to $5 billion, especially if coupled with its Web business. The weather.com site had more than 32 million unique users in November and ranks as the nation’s 18th-largest media site by traffic, according to Nielsen/NetRatings.

Other media companies, such as General Electric’s NBC Universal or News Corp., might want to buy the Weather Channel in order to cross-promote their own programs on a channel that is one of the 10 to 15 “go-to” cable channels for many people, said Jimmy Schaeffler, media analyst for the Carmel Group.

Mr. Schaeffler also noted there is a strong trend toward consolidation in the media industry. He likened the Landmark situation to News Corp. recently buying Wall Street Journal publisher Dow Jones for $5 billion.

“You go after a crown jewel,” he said. “What I think is happening here is, rather than waiting to be acquired in a hostile takeover, Landmark is saying we can probably do better for ourselves as shareholders if we do this in a friendly way.”

Landmark, which had $1.75 billion in sales in 2006, employs 12,000, according to Hoover’s. It is parent to nine daily papers, including the Roanoke Times in Virginia and the News & Record of Greensboro, N.C., and more than 100 nondaily newspapers and other publications.

Landmark also owns television stations in Las Vegas and Nashville, Tenn., and Norfolk-based Dominion Enterprises, a national chain of classified-ad publications.

Many employees learned of the plans to explore a sale when they read the morning paper.

“It looks like it’s the end of a long, storied history,” said Denis Finley, editor of the Virginian-Pilot of Norfolk. “I’ve been here 20 years. A lot of people have been here longer than I have. It’s something I don’t think we ever thought would happen. Most of us are in shock.”

Samuel L. Slover, Batten’s great-uncle, founded Landmark and was a dominant figure in Virginia newspaper publishing for a half-century. He came to Virginia from Tennessee in 1900.

Mr. Batten’s father, Frank Batten Sr., who turns 81 next month, was instrumental in building the company since becoming its head in 1954. He stepped down as chairman in 1998 but remains a board member.

Staff writer Kara Rowland contributed to this article in Washington.

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