GateHouse Files for ’HyperLocal’ IPO

GateHouse Media filed last week for an IPO that will enable it to buy and develop clustered "hyperlocal" media properties in the Northeast, Western, Northern, Midwest, Southern Midwest and Atlantic regions, including newspapers, directories, traders, shoppers and locally focused Web sites.

GateHouse, which operates in 285 markets in 17 states, is currently the leading publisher of community papers in New England. After a $460 million spending spree this spring that bought out Community Newspapers Inc. and Enterprise Newspapers, it literally surrounds Boston (and The Boston Globe). Altogether, GateHouse has 231 weeklies, 117 shoppers, 75 dailies and more than 230 related Web sites, and it serves more than 125,000 business advertisers. In addition, the company has opportunistically produced niche publications that address specific local market interests such as recreation, sports, healthcare and real estate. Over the past 12 months, it has created more than 90 niche publications.

The Internet is seen as a special opportunity. In New England, the company has developed WickedLocal as a possible prototype for the entire chain. In June, the company quietly named Bill Blevins as Internet head. Blevins had previously run Internet operations for Community Newspaper Holdings Inc. in Birmingham.

The filing notes that GateHouse is "well positioned to increase our online penetration and generate additional online revenues due to both our ability to deliver unique local content and our relationships with both readers and advertisers. We believe our local brands and unique local content make our sites a ‘must visit’ destination for our local audiences. This presents an opportunity to increase our audience penetration rates and advertising market share in each of the communities we serve.

"Centralizing our technology and building a network of websites will allow us to aggregate classified advertisements and build online classified products in areas such as real estate, automotive and recruitment. We will also have the ability to sell traditional online advertising locally and nationally. Finally, we will generally be able to share content across our organization within this network. This gives each of our publications access to technology, online management expertise, content and advertisers that they could not obtain or afford if they were operating independently."

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