Warren Buffett’s Berkshire Hathaway Inc. (NYSE:BRK.A) (NYSE:BRK.B) is making another acquisition next month. This time the billionaire investor is making a bet on small-town newspapers—and Atlantic City.
Berkshire to acquire The Press of Atlantic City
The Press of Atlantic City reported that BH Media Group, a subsidiary of Berkshire Hathaway Inc. (NYSE:BRK.A) (NYSE:BRK.B), will buy it from Abarta next month. The Omaha World-Herald, which is also owned by Berkshire, also announced the acquisition. Abarta has owned the paper since 1951.
The reports do not say how much Buffett’s firm paid for the newspaper, which will become its 30th daily paper. Berkshire also owns 40 weekly newspapers. In all, the papers owned by the firm stretch across 10 states. Other recent newspapers bought by Berkshire include the Roanoke Times and The Tulsa World, according to CNBC’s Alex Crippen.
A pattern emerges in Buffett’s paper buying scheme
CNBC notes that purchasing The Press of Atlantic City seems to fit in with Warren Buffett’s strategy regarding small-town newspapers. He seems to be focusing on smaller newspapers that are more community-oriented and which offer information that can’t be gotten from online sources, which are rapidly squeezing out paper newspapers.
The Atlantic City newspaper’s daily circulation is 67,000, while its Sunday circulation is 77,000. The paper’s website receives 700,000 unique visitors monthly.
Buffett had told CNBC at Berkshire Hathaway Inc. (NYSE:BRK.A) (NYSE:BRK.B)’s annual meeting months ago that he doesn’t see newspaper acquisitions as being a major part of the firm’s revenue in the future, but he expects to see a 10 percent annual return from them.
Still no major purchases for Berkshire
Buffett has been known for making major deals and big acquisitions, so his newspaper acquisitions are small in comparison to the deals he has done in the past. Berkshire’s acquisition of H.J. Heinz & Co. (NYSE:HNZ) earlier this year was the firm’s largest since 2010.