When Rich Boehne stepped down as CEO of E.W. Scripps last summer, he described the multimedia enterprise as an “adventurous 140-year-old company.”
That’s putting it mildly. Wall Street, which typically prefers predictable to adventurous, has marked down the stock 50 percent over the last year as its profitability lags industry norms by a lot.
Now gadfly billionaire investor Mario Gabelli, who owns 17 percent of the company’s stock, has nominated his own candidates for the three seats on the 11-person Scripps board not occupied or controlled by the Scripps family.
And management seems to partly agree that financial results need to quickly improve, announcing in January that it plans to sell all 34 of the company’s radio stations, leaving just a local broadcast group of 33 stations and some start-up specialty networks. Gabelli has said that margins should improve by six percentage points. New CEO Adam Symson says he can achieve growth in profits with plans already in place.
Management got a boost last week when the influential analytic firm Institutional Shareholder Services recommended against Gabelli’s nominees, saying he had “not presented a sufficiently detailed or compelling case” that Scripps issues require changes at the board level.
Even if management does prevail, Scripps, whose roots are in the newspaper business, will be left a TV and digital company, under pressure to expand with acquisitions or get swallowed by a bigger fish as the industry continues to consolidate rapidly.
How Scripps got into the current pickle relates to its past two decades of
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