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Frank Blethen

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Charles C. Cochrane

THE PAST 20 YEARS

1988: Then-owner Guy Gannett Publishing Co. breaks ground for construction of a $40 million printing plant in South Portland. The plant opens in 1990.

1991: The Evening Express ceases publication on Feb. 1 because of declining sales of the afternoon paper.

1993: Guy Gannett Publishing Co. changes its name to Guy Gannett Communications. The company owns five papers in Maine; television stations in Portland, Massachusetts, Iowa and Illinois; and MarCole, a California software company.

1994: Jean Gannett Hawley dies at age 70. Madeleine Corson, Hawley's niece and Guy Gannett's granddaughter, becomes chairwoman of Guy Gannett Communications.

1995: The Portland Press Herald launches its first site on the World Wide Web.

March 1998: Corson and John Gannett announce that the board of Guy Gannett Communications has decided to sell the company.

September 1998: Guy Gannett Communications announces it will end its 110-year publishing history by selling its Maine newspapers, including the Portland Press Herald and the Maine Sunday Telegram, to The Seattle Times Co. It also puts its television stations up for sale.

July 1999: Guy Gannett Communications transfers ownership of its final three television stations to Sinclair Broadcast Group. The transfer to Sinclair previously included WGME-TV (Channel 13).

March 17, 2008: The Seattle Times Co. announces it is looking to sell Blethen Maine Newspapers. The assets include the Portland Press Herald/Maine Sunday Telegram, the Kennebec Journal, the Morning Sentinel, the Coastal Journal, The Maine Switch and the MaineToday.com Web site.

The Seattle Times Co., parent company of the Portland Press Herald/Maine Sunday Telegram, is putting its Maine media properties up for sale.

Charles C. Cochrane, president and chief executive officer of Blethen Maine Newspapers, said the decision is based on The Seattle Times' need to focus on operating its newspapers in Washington state.

"The decision to explore a sale was painful," Cochrane said, "but a sale might be the best opportunity for the long-term survival of our newspapers in Washington and those in Maine."

The Seattle Times Co., which is owned by the Blethen family, bought the newspapers from Guy Gannett Communications in 1998. In addition to the Portland newspapers, Blethen Maine owns the Kennebec Journal in Augusta; the Morning Sentinel in Waterville; the Coastal Journal, a free weekly in Bath; The Maine Switch, a free weekly in Portland; and MaineToday.com, the company's online site.

Blethen Maine Newspapers has 509 full-time employees and 189 part-timers. It is Maine's largest newspaper group.

Cochrane said Blethen Maine Newspapers is making money and has been profitable every year since The Seattle Times purchased the papers, except for a loss last year related to an impairment charge -- a write-down of the value of intangible assets such as goodwill and brand value.

"Certainly, the profits have been less" in recent years, Cochrane said, a trend experienced by most of the country's newspapers as readers migrate to online sites, where they can find newspaper stories for free and where advertising is less lucrative. The loss of classified ads to online sites such as Craigslist also has hit papers hard, he noted.

The company last week said it was cutting 27 jobs, resulting in the layoff of 15 employees at the Portland Press Herald/Maine Sunday Telegram.

The Blethen family "has held off from selling anything while they hoped for a turnaround," Cochrane said. "It's now become clear that's not going to happen anytime soon."

The loss of revenue has depressed the value of newspapers and makes the family's decision to sell now "a little surprising," said John Morton, a newspaper analyst based in Maryland.

"I think we all know that they're struggling in Seattle. Business has not been good for large metropolitan newspapers in the last year, and I'm sure they haven't escaped that," Morton said. "It just comes down to where they need the money."

The Seattle Times is privately held and has never disclosed what it paid for the Maine newspapers, but Morton previously had estimated the price at $200 million.

Given the state of newspapers in 1998 -- near a high-water mark for values -- and now, the Blethens will be "lucky if they get half of what they paid for it," he said Monday.

Morton said the universe of potential buyers also is smaller now than it was a decade ago, which could keep the price down. Some of the country's larger chains, such as McClatchy Co. and Gannett Co. -- no relation to Guy Gannett Communications -- aren't in much of a position to buy. McClatchy recently posted a loss of more than $1.4 billion for 2007, and Gannett's earnings were down from a year ago.

"This is not a great time to sell a newspaper," Morton said.

Frank Blethen, president and chief executive officer of The Seattle Times, agreed.

"We did pay top dollar for them (the Maine newspapers)" in 1998, he said, and getting half that price "would be a reasonable assumption."

The company's broker, Dirks, Van Essen & Murray, "feels there's quite a few buyers out there," Blethen said, but his "dream" would be for a group of community investors to come forward to buy the papers.

"The workers here are stunned by the news," said Tom Bell, vice president of the Portland Newspaper Guild. "We are optimistic that a buyer can be found who can help us continue to serve our readers and also help us grow our online operations."

Blethen...