The Washington Post has just announced that it will be sold to Jeff Bezos, CEO and Founder of Amazon.com. Jeff Bezos is buying the Washington Post for $250 million.
Said Washington Post CEO Donald Graham, “Every member of my family started out with the same emotion — shock — in even thinking about it. But when the idea of a transaction with Jeff Bezos came up, it altered my feelings.”
“The Post could have survived under the company’s ownership and been profitable for the foreseeable future. But we wanted to do more than survive. I’m not saying this guarantees success but it gives us a much greater chance of success,” added Graham.
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As for valuation, according to financial analyst Paul Zwillenberg, “The reality for newspapers like the Washington Post is it’s impossible to use traditional financial metrics. These are trophy assets whose value is in the eye of the beholder.
Apparently this particular beholder, Jeff Bezos, felt that there was significant value. The deal arose from conversations between Graham and Bezos that initially started less than a month before the deal was confirmed, and according to sources Bezos did not even haggle over the asking price.
Confirmed Graham, “I named a price and Jeff agreed to pay it.”
The transaction is to be completed before the end of 2013.
Bezos was quick to reassure that there will not be radical changes to the Post. “I understand the critical role the Post plays in Washington, D.C., and our nation, and the Post’s values will not change. Our duty to readers will continue to be the heart of the Post, and I am very optimistic about the future,” he said.
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