Gannett refinances $1B in debt from merger in cost-saving move

Paul Davidson
 
| USA TODAY
USA TODAY owner Gannett and GateHouse Media owner agreed to mergeOn their own, each company has dealt with the decline of print revenue caused by the disruptive forces of online news, social media and smartphones.USA TODAYGannett, owner of USA TODAY and more than 260 other publications, said Monday that it has refinanced about $1 billion in debt in a move that will lower the company’s interest payments and save tens of millions of dollars a year.The deal will lower the interest rate on the $1.045 billion in debt to 7.75% from 11.5%, saving the company $90 million in interest this year.The move refinances more than half the loan that bankrolled the merger of GateHouse Media parent New Media Investment Group and the company previously known as Gannett in November 2019. The combined company took the name Gannett.“Refinancing our original term loan was our number one priority since closing the acquisition of Gannett Media Corp. in November 2019 and we are thrilled to have been able to do so this early into 2021, which is well ahead of our original target date,” Gannett Chairman and CEO Michael Reed said in a news release.“On the back of our strong preliminary fourth-quarter results, we believe we are well-positioned to organically grow our cash flow in 2021 and remain confident that we will be able to execute on $100-$125 million in additional asset sales this year,” Reed added.Gannett results: Gannett reports rebound as digital subscription strategy gains steamDelivery delays, shortages: Shoppers face shortages of cars, shirts and smart speakers amid COVID-19 shipping delaysIn November 2020, the company said it refinanced about $500 million in debt from the merger.The new $1 billion loan, arranged by Citigroup Global Markets, will mature in February 2026, the company said, replacing debt that was due in November 2024. The deal is scheduled to close early next week.Gannett now has about $1.5 billion in outstanding debt.

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