Warren Buffett speaks at the annual Berkshire Hathaway shareholders meeting in Omaha, Neb., on May 5, 2019.Warren Buffett’s Berkshire Hathaway Inc agreed to sell its newspaper business to Lee Enterprises Inc for $140 million in cash, abandoning an industry the billionaire investor had long defended even as its financial prospects deteriorated.
Lee owns 50 daily newspapers including the St. Louis Post-Dispatch, and has since July 2018 managed Berkshire’s papers other than the Buffalo News, which Berkshire bought in 1977.As part of the transaction, Berkshire will also become Lee’s sole lender, refinancing the Davenport, Iowa-based company’s existing debt and lending $576 million at a 9 per cent interest rate.
Berkshire has more than 90 operating businesses such as the BNSF railroad and Geico auto insurer, and bought most of its newspapers in the last decade. But he has lamented the newspaper industry’s decline, as the Internet deprives traditional newspapers of revenue streams.He told Yahoo Finance last April that the industry was “toast,” and told Berkshire shareholders in May 2018 that only the Wall Street Journal, the New York Times and perhaps the Washington Post had digital models strong enough to offset declining print circulation and ad revenue.