Sam Hits 21

The papers are clumsily written and crudely made up. Their ads are their most important feature. Classified ads spill over onto the front page, and the news columns often promote the latest offerings of local merchants. Even so, the morning Mobile (Ala.) Register (circ. 46,905) and the afternoon Mobile Press (circ. 71,483) had understandable attractions for Publisher Sam Newhouse: the only dailies in town, they are moneymakers, and they offer one more foothold in the burgeoning Gulf Coast region where the Newhouse empire has been busily expanding.* So Sam "bought" Mobile.

For upwards of $27 million, Newhouse got the two papers, some choice downtown real estate consisting of a highly automated modern printing plant that he says is a "jewel" and, as an added bonus, the Pascagoula (Miss.) Chronicle (circ. 10,050). The deal also included half-interest in Mobile's WKRG and WKRG-TV, which means that the FCC must give its approval before the bargain is finally sealed.

In many towns where Newhouse tries to take over a paper, its ownership is likely to be downright hostile. In Mobile, he was warmly received. The majority stockholders had been disturbed by paltry dividends, and they resented the hammer lock held on the papers by the local management. The stockholders were even more irked when management tried to squeeze the nearby Pascagoula Chronicle out of business.

It wrapped a page of Pascagoula news around the Mobile papers and started selling them in Pascagoula. The new edition, called the Mississippi Press Register, lost nearly $750,000, but the Chronicle lost heavily too. Chronicle President Ralph Nicholson decided to sell out--but not to the immediate competition. Canadian-born Publisher Lord Thomson bought the paper, then turned around and sold it to the Mobile papers for a hefty $1,200,000.

After that, Newhouse raised his offer to more than $27,000,000, and various branches of the locally prominent McGowin family that held 53% of the stock decided to sell him their block of shares, giving him control of the company. The deal had scarcely been consummated before Newhouse arrived in town to inspect his latest acquisition--which boosts the number of newspapers he owns to 21.

* Other Newhouse papers in the area: The Huntsville (Ala.) Times and Birmingham News, bought in 1955, the New Orleans Times-Picayune and States-Item, both bought in 1962.

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