Rupert Murdoch's News Corp (NWSA.O) said on Tuesday that it has sold Dow Jones Local Media Group to a unit of Fortress Investment Group for an undisclosed sum.
The sale includes the former Ottaway newspaper chain of eight daily and 15 weekly community newspapers such as the Cape Cod Times in Hyannis, Massachusetts, and The Pocono Record in Stroudsburg, Pennsylvania.
Investment management group Fortress also owns GateHouse Media, a chain of more than 400 community newspaper dotted throughout the United States, which will manage the local media group.
The move has been in the works by News Corp ever since it acquired in 2007 Dow Jones, also the publisher of the Wall Street Journal. Murdoch quickly put the local papers on the block though it was right as the financial crisis hit and the market for newspaper transactions dried up.
Christine Frank, managing director at Waller Capital Partners, the firm that advised Dow Jones, said there was very "healthy interest" in the auction but declined to say how many parties bid. "There are a lot of new entrants for buyers of newspapers," she said about the timing.
News Corp's publishing assets recently separated from its entertainment and cable properties, which are now part of 21st Century Fox Inc (FOXA.O). Along with the Wall Street Journal, News Corp's newspaper portfolio include big market dailies like the Times of London, The Australian and the New York Post.
"We are confident that the papers will prosper under the new owners, but they were not strategically consistent with the emerging portfolio of the new News," Robert Thomson, chief executive of News Corp, said in a statement.
The sale of the Dow Jones local newspapers is part of a larger trend over the past months as several properties have changed hands.
In August alone two big metro deals were struck: The New York Times Co (NYT.N) sold The Boston Globe and its sister newspaper to Boston Red Sox owner and hedge fund manager John W. Henry for $70 million, a fraction of the price it paid when it bought the papers for more than $1 billion.
The Graham family decided to exit the newspaper business after 80 years and agreed to hand over the Washington Post to Amazon.com Inc (AMZN.O) founder Jeff Bezos for $250 million.
(Reporting by Sruthi Ramakrishnan in Bangalore and Jennifer Saba in New York; Editing by Lisa Shumaker)