Update: Thomson Sells Remainder of U.S. Newspapers

Updated from 11:58 a.m. EDT

Canadian publishing concern Thomson has reached a deal to sell the last of its U.S. newspaper holdings, announcing Friday that it has agreed to unload two Ohio daily papers and 10 non-dailies to closely held Cox Newspapers for an undisclosed amount.

With the announcement earlier this week of the sale of its Connecticut newspaper operations to MediaNews Group, Thomson has agreed to sell all of its U.S. newspaper operations, consisting of 49 dailies and their ancillary operations, for $2.44 billion.

In February, Toronto-based Thomson, a traditional print publisher, announced that it would sell 54 newspapers in the U.S. and Canada, which comprise the entirety of its newspaper holdings except for The Toronto Globe and Mail.

According to Thomson, proceeds from the sale of the newspapers will be used to reduce debt and provide additional borrowing capacity as the company focuses more on providing information online and through CD-roms and computer software.

Last month, Thomson said it would sell these Ohio properties, as well as the newspapers in six other strategic groups, to Gannett (GCI) in a deal totaling $1.125 billion. However, Cox exercised its right of first refusal on the southwestern Ohio properties, leading to Friday's announcement. Thomson said it expects the sale to be completed during the third quarter.

A Thomson spokesman said Cox gained the right of first refusal on the southwestern Ohio properties as part of a 1996 deal in which Thomson acquired some Arizona dailies from Cox.

Under the terms of the previously announced agreement with Gannett, Thomson will still sell to Gannett 19 daily newspapers and 23 non-dailies in central Ohio, Louisiana, Maryland's Chesapeake region, Wisconsin and Utah.