If this math is correct, this will certainly send some valuations into a tizzy. Topix.net, the news aggregation play which got majority bought (75 percent) out by Gannett, Knight-Ridder and the Tribune Company, has been the subject of speculation ever since the deal was announced in March. Mainly related to how much did the three newspaper giants paid for that stake.
Well, we have the answer now: according to SEC filings from Tribune, it paid $16 million for the 25 percent stake, and according to Gannett’s SEC filing, it paid $18 million (well, that includes some other investments, so possibly $16 million too), and assuming Knight Ridder paid $16 million too, the total amount would be $50 million, the higher side of the previously speculated range. From the Tribune filing: “The Company’s maximum loss exposure related to these entities is limited to its equity investments in CareerBuilder, LLC, Classified Ventures, LLC, CrossMedia Services, Inc. and Topix, LLC, which were $76 million, $8 million, $25 million and $16 million, respectively, at March 27, 2005.” From Gannett’s filing: “Cash used by the company for investing activities totaled $72.9 million for the first three months of 2005 primarily reflecting $52.8 million of capital spending and $18 million for a 25% equity interest in Topix.net and additional funding of investments such as CareerBuilder and CrossMedia Services, Inc., offset by proceeds from investments.”
There, now you know….