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The Spokesman-Review Newspaper
Spokane, Washington  Est. May 19, 1883

Scripps to split newspapers, TV from cable

Terry Kinney Associated Press

CINCINNATI – E.W. Scripps Co. said Tuesday it plans to split itself into two publicly traded media companies, one focusing on its fast-growing cable operations and online shopping services and the other on its slumping newspaper business and television stations.

Scripps stock jumped more than 7 percent after the announcement, which comes only two weeks after media rival Belo Corp. said it plans to divide into separate newspaper and TV businesses.

Under the plan announced Tuesday, Scripps shareholders would receive stock in Scripps Networks in the form of a tax-free dividend.

“Needless to say, this is a significant development in the history of this great media company,” Kenneth W. Lowe, Scripps’ president and chief executive, told analysts.

Scripps Networks Interactive would include HGTV, the Food Network, DIY Network, Fine Living Television Network and Great American Country along with online comparison shopping services Shopzilla and uSwitch.

E.W. Scripps Co. would include newspapers in 17 U.S. markets, 10 broadcast television stations, a character licensing and feature syndication business operated by United Media and Scripps Media Center in Washington, D.C.

Dallas-based Belo said two weeks ago it plans to spin off its newspapers, which have been struggling to keep readers and advertising dollars, into a new company that will operate separately from its 20 television stations.

Scripps’ stock jumped $3.18, or 7.5 percent, to $45.46 in afternoon trading Tuesday. The stock has traded between $37.89 and $53.39 in the past year.

Scripps said the split could be completed in the second quarter.

In a time of declining newspaper circulation, Scripps has aggressively diversified with popular cable TV networks, Shopzilla and uSwitch.

Scripps’ newspapers include the Rocky Mountain News in Denver, the Commercial Appeal in Memphis, Tenn., the Knoxville (Tenn.) News Sentinel and the Ventura County (Calif.) Star.

The deal needs final approval by the company’s board along with shareholders. It also is contingent upon a favorable ruling from the Internal Revenue Service on the tax-free nature of the transaction.