Proposal Would Build on Unique Strengths of National, Local Media
CINCINNATI, Oct. 16 /PRNewswire-FirstCall/ -- The E. W. Scripps Company's
(NYSE: SSP) board of directors has unanimously authorized management to pursue
a plan to separate Scripps into two publicly traded companies, one focused on
creating national lifestyle media brands and the other on building market-
leading local media franchises.
The two companies that would exist after the separation would be:
-- Scripps Networks Interactive, which would consist of the national
lifestyle media brands and associated enterprises that operate
collectively as Scripps Networks, including television's HGTV, Food
Network, DIY Network, the Fine Living Television Network and Great
American Country and their category-leading Internet businesses. The
new company also would include online comparison shopping services
Shopzilla and uSwitch and their associated Web sites. These businesses
have combined annual revenue of approximately $1.4 billion and 2,100
employees.
-- The E. W. Scripps Company, which would include daily and community
newspapers in 17 U.S. markets; 10 broadcast television stations
clustered among the nation's largest 50 markets, including six ABC
affiliates, three NBC affiliates and one independent station; the
character licensing and feature syndication businesses operated by
United Media; and Scripps Media Center in Washington D.C., which
includes the Scripps Howard News Service. These businesses have
combined annual revenue of about $1.1 billion and employ about 7,100
people.
"This is an important and logical next step for our shareholders,
employees and all other stakeholders who have a direct interest in the success
of our media businesses," said Kenneth W. Lowe, president and chief executive
officer for Scripps. "It's our intention to create two publicly traded
companies, each with a sharpened strategic focus that would foster continued
growth, solid operating performance and a clear vision on how best to build on
the specific strengths of our national and local media franchises."
"The new company that would be created by the transaction - Scripps
Networks Interactive -- would be anchored by two of America's most-watched and
most successful cable television networks - HGTV and Food Network - and would
benefit from the rapidly growing popularity of its newer lifestyle brands, DIY
Network, Fine Living and Great American Country. HGTV and Food Network are
each now available in more than 95 million U.S. television households and have
proven themselves many times over to be valuable and efficient platforms for
advertisers who want to reach engaged and motivated audiences. Further, our
newer brands are each now available in about 50 million U.S. households and
are having considerable success building loyal audiences of passionate viewers
of their own."
"On the Internet, Scripps Networks operates Web sites that are undisputed
leaders in the lifestyle categories that we've popularized on TV," Lowe said.
"FoodNetwork.com consistently leads its content category and HGTV.com is the
leading, purely home and garden content site on the Internet. Our growing
portfolio of related interactive initiatives at Scripps Networks, along with
our Internet search businesses - Shopzilla and uSwitch - would add to the new
company's overall potential for long-term growth."
"At The E. W. Scripps Company, shareholders would benefit from the
strength of our established, high-profile local media brands," Lowe said.
"These are businesses built on the company's 130-year tradition of
journalistic excellence, community service and local media innovation. The
company's portfolio of valuable media assets would include established print,
online and broadcast franchises in some of the country's most attractive and
fastest growing markets, including West Palm Beach, The Treasure Coast, Tampa
and Naples, all in Florida; East Tennessee's Knoxville; California's Ventura
County and Phoenix in the Sun Belt."
"Scripps newspapers, including the Pulitzer-prize winning Rocky Mountain
News in Denver, reach more than 1 million readers every day -- both in print
and online -- delivering up-to-the-minute news and information," Lowe said.
"Likewise, our network-affiliated television stations are viewable in markets
representing 10 percent of the U.S. population. The Scripps Television Station
Group has a solid reputation for journalistic excellence and community service
and has garnered more than its share of Emmy, Peabody and Murrow awards - the
broadcast industry's top honors."
"The E. W. Scripps Company also will benefit from the steady revenue it
derives from its United Media subsidiary, which is the licensing and
syndication home of Peanuts, arguably the world's most famous comic strip, and
150 other features and intellectual properties, including Dilbert and Get
Fuzzy, just to name two," Lowe said. "About 2,400 newspapers in the U.S. and
across the globe publish classic Peanuts strips, which is a testament to the
enduring popularity of Charlie Brown, Snoopy and the strip's entire cast of
characters."
The proposed separation would take the form of a tax-free dividend of
stock in Scripps Networks Interactive distributed to all Scripps shareholders
on a pro-rata basis. The separation is expected to be completed in the second
quarter of 2008.
Following the separation each company will have two classes of common
stock - Common Voting Shares and Class A Common Shares -- as is the case now
with The E. W. Scripps Company. Through its ownership of Common Voting Shares,
The Edward W. Scripps Trust would maintain control of both companies by
electing a majority of board members for each.
Both companies are expected to have strong, investment-grade balance
sheets, which would enable them to pursue their respective growth
opportunities. The current dividend paid by The E. W. Scripps Company is
expected to be maintained upon completion of the separation, apportioned
appropriately between the two companies.
In addition to approval of the final plan by the board of directors and
approval by the holders of the company's Common Voting Shares, completion of
the separation will be contingent upon a favorable ruling from the Internal
Revenue Service on the tax-free nature of the transaction and the filing and
effectiveness of a Form 10 registration statement with the Securities and
Exchange Commission.
The registration statement, which is expected to be filed in early 2008,
will include relevant information about the companies, the proposed separation
and related matters. The registration statement will be distributed to
shareholders following completion of the SEC's review.
Following the separation, it is anticipated that Lowe will become
president and chief executive officer of Scripps Networks Interactive. At The
E. W. Scripps Company, Richard A. Boehne, currently executive vice president
and chief operating officer, is expected to become president and chief
executive officer.
Corporate headquarters for both companies would be in Cincinnati. Changes
are anticipated at corporate headquarters to accommodate the creation of two
separate publicly traded companies.
The proposed separation is not expected to have a material effect on the
day-to-day lives of employees working at the company's television networks,
newspapers, broadcast television stations, Internet search businesses,
licensing and syndication subsidiary and other related businesses.
Upon completion of the transaction Class A Common Shares of both companies
are expected to be traded on the New York Stock Exchange. As is the case
currently at The E. W. Scripps Company, there will be no public market for the
Common Voting Shares of both companies.
Conference call
The senior management team at Scripps will discuss the proposed separation
plan during a telephone conference call at 10 a.m. EDT today. Scripps will
offer a live audio Web cast of the conference call. To access the Web cast,
visit www.scripps.com, choose "Shareholders" then follow the link in the
"Upcoming Events" section.
To access the conference call by telephone, dial 1-800-762-7308 (U.S.) or
1-480-629-9025 (International), approximately 10 minutes before the start of
the call. Callers will need the name of the call (company announcement) to be
granted access. Callers also will be asked to provide their name and company
affiliation. The media and general public are provided access to the
conference call on a listen-only basis.
A replay line will be open from 1:30 p.m. EDT today until 11:59 p.m. EDT
Tuesday, Oct. 23. The domestic number to access the replay is 1-800-475-6701
and the international number is 1-320-365-3844. The access code for both
numbers is 891390.
A replay of the conference call will be archived and available online for
an extended period of time following the call. To access the audio replay,
visit www.scripps.com approximately four hours after the call, choose
"Shareholders" then follow the "audio archives" link on the left navigation
bar.
Forward-looking statements
This press release contains certain forward-looking statements related to
the company's businesses, including the proposed separation plan, that are
based on management's current expectations. Forward-looking statements are
subject to certain risks, trends and uncertainties, including changes in
advertising demand and other economic conditions that could cause actual
results to differ materially from the expectations expressed in forward-
looking statements. All forward-looking statements should be evaluated with
the understanding of their inherent uncertainty. The company's written policy
on forward-looking statements can be found on page F-5 of its 2006 SEC Form
10K.
We undertake no obligation to publicly update any forward-looking
statements to reflect events or circumstances after the date the statement is
made.
About Scripps
The E. W. Scripps Company (www.scripps.com) is a diverse and growing media
enterprise with interests in national cable networks, newspaper publishing,
broadcast television stations, interactive media, and licensing and
syndication.
The company's portfolio of media properties includes: Scripps Networks,
with such brands as HGTV, Food Network, DIY Network, Fine Living and Great
American Country; daily and community newspapers in 17 markets and the
Washington-based Scripps Media Center, home to the Scripps Howard News
Service; 10 broadcast TV stations, including six ABC-affiliated stations,
three NBC affiliates and one independent; Scripps Interactive Media, including
leading online search and comparison shopping services, Shopzilla and uSwitch;
and United Media, a leading worldwide licensing and syndication company that
is the home of PEANUTS, DILBERT and approximately 150 other features and
comics.
SOURCE The E. W. Scripps Company
-0- 10/16/2007
/CONTACT: Tim Stautberg of The E. W. Scripps Company, +1-513-977-3826,
stautberg@scripps.com/
/Web site: http://www.scripps.com/
(SSP)
CO: The E. W. Scripps Company; Scripps; Scripps Networks Interactive
ST: Ohio
IN: PUB RAD TVN ENT
SU: RCN CCA
CR-CB
-- CLTU033A --
9221 10/16/2007 07:00 EDT http://www.prnewswire.com
