Gannett To Close Tucson Newspaper If No Sale By March 21

   DOW JONES NEWSWIRES

Gannett Co. (GCI) said it is trying to sell assets of the Tucson (Ariz.) Citizen and would close the newspaper if a sale is not completed by March 21.

The announcement echoed one last week by Hearst Corp., which said it will attempt to sell the Seattle Post-Intelligencer in 60 days. If it can't, the paper would move to a digital-only operation with a greatly reduced staff or be closed. E.W. Scripps Co. (SSP) has made a similar announcement about the Rocky Mountain News in Denver.

Founded in 1870, the Citizen, published Monday through Saturday afternoon, has been part of Gannett since 1976. It is published as part of a joint operating arrangement by TNI Partners with the much larger Arizona Daily Star, which is owned by a subsidiary of Lee Enterprises Inc. (LEE).

Each newspaper has a separate newsroom and the editorial operations of the newspapers are entirely independent. TNI provides production, distribution, sales and other non-editorial business functions for both newspapers.

Average daily circulation of the Citizen is 19,851, according to the latest Audit Bureaus of Circulation report. At the end of April, the Daily Star's circulation was 113,373.

"Dramatic changes in our industry combined with the difficult economy - particularly in this region - mean it is no longer viable" to produce two daily newspapers in Tucson, said Bob Dickey, president of Gannett's U.S. Community Publishing division.

Gannett, which owns 85 U.S. newspapers including USA Today, this week said its U.S. nonunionized employees will take a week of unpaid leave in the current quarter, the latest indication of the publishing industry's financial straits.

Lee acquired the Arizona paper, along with the St. Louis Post-Dispatch and other papers, when it bought Pulitzer Inc. in 2005 for $1.46 billion. It has been suffering under the heavy debt burden it acquired with that deal.

Gannett's shares closed at $7.59, up 1.5%, on Friday, while Lee's closed down 2.7% at 36 cents. Both were unchanged after hours.

-By Kathy Shwiff, Dow Jones Newswires; 201-938-5975; Kathy.Shwiff@dowjones.com

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