Independent bought by World-Herald

The Grand Island Independent and York News-Times were bought Thursday by the Omaha World-Herald Co.

The sale is the second The Independent has been involved in within the past year.

The two papers were among 14 daily newspapers bought Dec. 1, 2007, by GateHouse Media of Fairport, N.Y., from Morris Communications of Augusta, Ga.

The sale was made final at 12:01 a.m. Thursday. Independent Publisher Don Smith and executives from the World-Herald Co. announced the sale Thursday morning.

Terry Kroeger, publisher and chief executive officer of the World-Herald Co., said his company has long had its eye on The Independent, including an attempt to purchase the paper when it was sold to Morris in 1994.

Kroeger called the purchase a vote of confidence in The Independent's market share and journalistic output.

"Grand Island's a very, very nice market. The economy here is very attractive to us," Kroeger said. "And more importantly, The Independent has a long history of service to the community, which leads to its place in that market."

The sale marks the first time The Independent has been under Nebraska ownership in more than seven decades.

Smith said that as a majority employee-owned company, the World-Herald Co. values community involvement and has deep roots in the state and its rural markets.

"We don't anticipate facing another ownership change for a long time," Smith said.

Both Smith and Kroeger said they expect no immediate changes at The Independent.

Kroeger said the World-Herald Co. has a long history of allowing independence among its newspapers.

"Decisions about Grand Island coverage are best made in Grand Island," he said.

Smith did say The Independent will have access to the World-Herald News Service, which distributes news among newspapers in Nebraska and Iowa.

Terms of the sale were not disclosed. Smith and Kroeger said the arrangement developed within the past several weeks.

GateHouse Media, which is traded on the New York Stock Exchange, reported in July a $429 million operating loss across its hundreds of small newspapers for the second quarter of 2008. It suspended its dividend to stockholders that quarter to increase its liquidity and pay off debts.

"We did not see the Grand Island operation as a good strategic or geographic fit and felt we could redeploy the capital more effectively elsewhere," said Mike Reed, GateHouse's chief executive officer, in a statement to the trade magazine Editor & Publisher. "I am delighted to announce the sale of these publications to the Omaha World-Herald Co., which has a significant and venerable presence in Nebraska."

The World-Herald Co. owns 10 daily newspapers, 23 non-daily papers and 27 free-circulation papers in Nebraska and Iowa, including newspapers in Kearney, North Platte and Scottsbluff.

With its daily circulation of 20,500, The Independent is now the largest newspaper in the World-Herald Co. outside of its flagship paper, the Omaha World-Herald.

Smith said that despite turmoil in other parts of the newspaper industry, small newspapers remain very profitable, especially in rural markets like Grand Island.

He said he was excited to have a privately held, financially sound company in control of The Independent.

"They have acquired two very healthy newspapers that make their company that much stronger," Smith said.