Warren Buffett is spending $142 million (€111.7 million) on 63 US newspapers, six months after Berkshire Hathaway spent $200 million on the group that publishes the Omaha World Herald, his local newspaper.
The billionaire former paper boy is buying most of the titles of Media General, a Virginia group that also owns 18 television stations.
Media General’s newspapers generated cash flow of $28 million last year. The 63 titles range from the Richmond Times-Dispatch, with an average of 164,000 Sunday readers last year, to the Culpeper Star-Exponent, with just 6,000.
“In towns and cities where there is a strong sense of community, there is no more important institution than the local paper,” Mr Buffett said.
Berkshire Hathaway has long had investments in the Buffalo News and the Washington Post, but even as other investors have marked US publishing stocks down to new lows Mr Buffett told this month’s annual meeting he might buy more.
“The economics will be okay, but it will be nothing like the old days.”
Newspapers did not fulfil as many functions as they used to, but his Omaha paper delivered “things that I can’t find out elsewhere” about his city, local sports and his neighbours.
He has supported digital subscriptions, cautioning that charging for content in print while giving information away free online was unsustainable.
– Copyright The Financial Times Limited 2012
