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Daily Herald Co. being sold to Sound Publishing

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By Julie Muhlstein and Eric Stevick
Herald Writers
Published: Thursday, February 7, 2013, 12:01 a.m.
EVERETT -- The Everett Daily Herald, which also publishes The Herald Business Journal, is being sold to Canada's Black Press, which operates as Sound Publishing Inc. in Washington.
The Washington Post Co., which has owned the newspaper for 35 years, made the announcement Feb. 5.
Gloria Fletcher, president of Sound Publishing, told Herald employees the transaction is expected to close in early March.
Ann McDaniel, senior vice president of the Washington Post Co., declined to disclose a purchase price for the 46,000-circulation daily newspaper and its other print and online products. "We won't be talking about the price, we never do," she said.
Sound Publishing owns 39 newspaper and digital titles in Washington, with a combined free and paid circulation of more than 730,000 statewide. Among them are The Marysville Globe, The Arlington Times, The Peninsula Daily News in Port Angeles, and newspapers on Whidbey Island. Sound Publishing recently bought Seattle Weekly, and also owns papers in Bellevue, Kent and Renton.
"The Herald fits in very well. We believe in community journalism. We believe in newspapers," Fletcher said. The Herald will continue to publish seven days a week. "That would be my intention right now," Fletcher said.
"Sound Publishing is very excited about this announcement. You and the product you produce, on a day in-day out basis, are very well-respected in the industry and in this community," Fletcher told Herald employees.
Black Press, Ltd., based in Surrey, B.C., publishes more than 170 newspapers and other publications in Washington, British Columbia and Alberta, Canada, as well as the Honolulu Star-Advertiser in Hawaii and the Akron (Ohio) Beacon-Journal daily newspapers.
"This is a bittersweet day for the Washington Post Company," McDaniel told Herald employees.
"For the 35 years the Post owned the paper, we have been committed to quality journalism," McDaniel said. As the business changed, she said, it became harder to fulfill that mission while owning no other newspapers outside the Washington, D.C., and Maryland areas. The Washington Post Co. owns a group of community newspapers covering Maryland and Fairfax, Va.
With Sound Publishing based in Washington state, The Herald's corporate parent will now be close.
McDaniel said the Post had two goals in negotiating the sale: to preserve the quality of the products, and to save as many jobs as possible.
Besides The Herald and HeraldNet.com, The Daily Herald Co. publishes The Herald Business Journal and the Spanish-language weekly and website La Raza del Noroeste. This is the first Spanish-language publication owned by Sound.
The Daily Herald Co. has 209 employees. McDaniel said that David Dadisman, who became The Herald's publisher last May, will lead the transition.
"I really do think this will strengthen The Herald," said Dadisman, who is also the newspaper's general manager.
"With the kind of business we are in, you can only succeed if you have some economies of scale and shared resources," he said Wednesday. "We are going to be able to leverage some things we can't do now."
McDaniel said many employees will receive the same salary and similar benefits after the sale, but that Sound Publishing handles its own production and distribution, so layoffs could occur.
Dadisman said he doesn't know how many jobs could be eliminated by using the Everett-based printing press already owned by Sound Publishing. He also expects that some business office jobs could be integrated into the larger Sound Publishing operation.
Dadisman said he plans to leave The Herald after the 90-day transition.
Larry Hanson retired in 2002 after a 45-year career at The Herald, including 18 years as publisher and president of the newspaper.
"My initial thought, after absorbing the news, is that I'm hoping Sound Publishing will appreciate what a quality newspaper The Herald is and has been, and that they also recognize how important The Herald is to the community," said Hanson, who grew up in Everett.
"Print journalism is going through a challenging time developing the right business model for the Internet age," Hanson said.
The Daily Herald Co. laid off six employees on Jan. 4, including four in the news department. That was the third significant staff reduction in as many years. The Herald offered early retirements in late 2011, and there were layoffs in late 2010. Last year, the company closed The Weekly Herald, a free publication that served south Snohomish County.
No changes are expected for the next 30 days. Sound Publishing is not buying The Herald's building, which is owned by the Washington Post Co.
"The buildings will be on the market," McDaniel said. Snohomish County's 2013 assessed value for The Herald buildings at 1213 California St. is $5.2 million. A 2.2-acre parcel owned by the Herald across W. Marine View Drive, up for sale for several months, has a listed asking price of nearly $4 million.
For the next year, Sound Publishing will lease The Herald building. "We're certainly going to be here for a year at least," Fletcher said.
She said the paper will ultimately be printed at the Sound Publishing facility near Paine Field. That could happen before the year is out.
Dadisman doesn't know what he will do next professionally, but the change will allow him to spend more time with his wife of nearly 29 years.
While Dadisman moved to Everett three years ago from the Washington Post Co., his wife, Beth, remained on the East Coast. He served as The Herald's general manager before being named publisher last year. Dadisman grew up in a newspaper family. His father, Carrol Dadisman, was a reporter who later became publisher of the Tallahassee Democrat newspaper in Florida.
Dadisman worked on the business side of the profession.
"I have never had a byline, but I love the business," he said. "I have ink in the blood as they say."
Hanson recalled the anxiety Herald employees felt more than three decades ago when the newspaper owned by the local Best family was sold to the Washington Post Co.
"Because it was a family newspaper for three-quarters of a century, I know some of us were nervous and a bit taken aback," Hanson said. "But we were encouraged from the beginning when Katharine Graham said 'we respect what The Herald means to this community and we will continue operating it like a strong community newspaper.' And they did.
"Hopefully, the employees as well as the community will wait and see what the new owners are going to do," Hanson said.
Herald writer Noah Haglund also contributed to this story.
Julie Muhlstein: 425-339-3460, muhlstein@heraldnet.com.

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