Berkshire Hathaway to Buy Omaha World-Herald Newspaper

Warren Buffett’s Berkshire Hathaway Inc. will expand its media holdings by acquiring the Omaha World-Herald Co., publisher of the billionaire’s hometown newspaper.

The World-Herald reported the price as $150 million plus assumption of debt. The deal would give Berkshire control of the World-Herald, six other daily newspapers and several weekly newspapers across Nebraska and southwest Iowa, according to a company statement today. Sellers include employee shareholders and the Peter Kiewit Foundation.

Buffett is putting aside his doubts about the industry after telling shareholders in 2009 that papers have “potential for unending losses” and that he wouldn’t buy most of them “at any price.” Publishers have lost revenue as readers shift to other media including the Internet.

Buffett told employees today that newspapers “have a decent future,” according to the World-Herald’s account. “It won’t be like the past. But there are still a lot of things newspapers can do better than any other media.” As for the cost, Buffett said, “it’s not a crazy price. It certainly is not a bargain.”

In addition to the $150 million cash purchase, Berkshire will take on $50 million of World-Herald debt, the newspaper reported. Buffett didn’t respond to an interview request e- mailed to Berkshire’s Omaha headquarters.

“That’s a pretty generous price,” said John Morton, a veteran newspaper analyst and president of media consulting firm Morton Research Inc. who writes a column for the American Journalism Review. “That’s a price that you would have paid for it five years ago.”