Landmark Chairman Batten Jr.: 'It was my decision'

NORFOLK

The decision to market Landmark Communications Inc. – parent of The Virginian-Pilot and employer to more than 9,000 – came down to one person: Frank Batten Jr.

Batten, who took over leadership of the family-run media company from his father in 1998, said Thursday that he first considered the idea – and then chose that course – in November. But he repeatedly refused to say why.

“It was my decision,” said Batten, 49, who controls a majority interest in the privately held company. It was approved, he said, by family members, including Frank Batten Sr., without dissension.

“There was consensus among all of the family members that this was the right course of action to explore,” said Batten, Landmark’s chairman and chief executive officer.

Landmark confirmed media reports late Wednesday that it had hired two national investment firms, JPMorgan and Lehman Brothers, to “assist in exploring strategic alternatives, including the possible sale of the company’s businesses.”

A formal announcement to employees at all Landmark properties nationwide was made Thursday.

Company revenues topped $2 billion last year. A sale of all, or some, of Landmark’s properties – which include The Weather Channel in Atlanta and Dominion Enterprises – could occur as soon as summer, Landmark executives said.

They stressed that enlisting the investment firms didn’t guarantee that Landmark would be dismantled. But even while discussing why he couldn’t disclose his reasons, Batten suggested that the goal was to release its holdings.

“In a sales process, it’s best not to talk about the sales process,” he said. “We’re just going to explore our alternatives and decide as time goes on.”

The greatest share of Landmark’s profits, Batten said, comes from The Weather Channel, which reaches about 97 million households and celebrated its 25th anniversary last year. The station, combined with Landmark’s other weather-related businesses, could fetch roughly $5 billion.

Next largest, Batten said, is Dominion Enterprises, a conglomeration of publications and Web sites ranging from employment to real estate, housed in a one-year-old, 20-story building on Granby Street. Its annual revenue nears $1 billion.

Coming in third is Landmark’s collection of newspapers, including The Pilot and The Roanoke Times, and television stations in Las Vegas and Nashville, Tenn.

“I’m very optimistic that this is the right thing for our shareholders,” Batten said, “and that all of our businesses will prosper, grow and do well under new ownership.”

The several hundred shareholders include family members, some longtime employees and executives, and former Landmark workers, with about 15 individuals or personal trusts having 1 percent or more outstanding stock.

The announcement, coming during a depressed period for the newspaper industry, confounded some media researchers. But John Morton, a veteran newspaper analyst and president of Morton Research Inc. in Silver Spring, Md., said the Battens might have chosen to act before profit margins erode further.

Frank Daniels Jr., a former newspaper publisher and former member of Landmark’s board, also said this could be a good time to sell Landmark, which he described as a “very well-run company.”

“I don’t see any uptick in the future” for newspaper companies, Daniels said. “The smartest thing they did,” he said of Landmark, “was continue to invest in 'new media’ and not buy any more newspapers.”

Batten, however, predicted a robust 2008 for Landmark.

“The company’s doing very well financially,” he said. “We’re seeing very positive trends in a number of our businesses.”

Landmark, Batten said, has “great businesses, and a lot of people will be interested.”

Perhaps the only safe prediction, given Landmark’s vast array of holdings, is that no buyer would likely want the entire company. Even if Landmark sells its four midsize daily newspapers, it’s impossible to predict whether they would be bought as a group or individually.

Batten said he would steer clear of “inappropriate buyers,” without elaborating.

Landmark, he said, will try to safeguard employees’ defined-pension benefit plans. As for the future of workers under new owners, “certainly my hope will be as few layoffs as possible,” Batten said. “I don’t anticipate large layoffs in the community.”

Batten said he brought up the decision to explore selling the company at Landmark’s Nov. 30 board meeting, and there was no disagreement.

He described it as “an emotionally difficult decision for everybody, including me, and especially for my father, who’s worked in the company for more than 50 years.”

Frank Batten Sr., the nephew of Landmark’s founder, Samuel L. Slover, is credited with building up the company during his 44-year run as its chief executive.

A message left for him was not returned Thursday. Although Batten, who will turn 81 next month, has suffered from a number of ailments in recent years, his son described him as healthy and fully recovered from a broken hip.

Two other Landmark board members declined to comment Thursday.

The decision to explore selling Landmark was a closely held secret. Several people who own shares of nonvoting stock in the company said they did not know about it before the announcement.

Daniels said the sale of the entire company was never discussed during his 25 years on the board. He stepped down in April 2006.

“There were some discussions about selling The Weather Channel, but they never progressed very far,” said Daniels, former publisher of The News & Observer in Raleigh, N.C.

Daniels experienced a similar turn when the Raleigh paper, which was owned by his family for 101 years, was sold to McClatchy Newspapers in 1995.

“There were a few good years ahead for the company when he sold it,” he said. “Times are different now.”

Sitting in his third-floor office, overlooking Brambleton Avenue, Batten said his future, like the company’s, was undecided.

“My complete focus is on running Landmark,” Batten said. “I don’t know what I’ll do next. I’m just trying to do a good job for our shareholders.”

Staff writer Tom Shean contributed to this story.

Philip Walzer, (757) 222-3864, phil.walzer@pilotonline.com