A.H. Belo, owner of The Dallas Morning News, is adding promotional products to its long-range strategy. The company last week purchased majority ownership of three Dallas-based marketing companies for $15.3 million: Distribion, Vertical Nerve and Marketing FX (asi/154786). The three companies will maintain their current management team, day-to-day operations and location.
The companies will become part of the newly formed DMV Digital Holdings Co. Marketing FX is a turnkey resource that provides print, packaging, promotional product and fulfillment services to companies nationwide. Distribion provides a local automation solution for marketing campaigns, while Vertical Nerve is a digital optimization agency that helps clients increase Web traffic.
“The addition of these three new companies to our portfolio represents an opportunity for our advertising clients to take advantage of data-driven marketing automation technology and services,” said Jim Moroney, chairman, president and CEO of A.H. Belo. “These are first-class companies, and we are excited to provide new opportunities to help our clients grow their businesses.”
The management team behind Distribion, Vertical Nerve and Marketing FX invested alongside A.H. Belo in the purchase. Tim Storer, CEO/chairman of the three companies, retains a minority stake. The Dallas Morning News reported that the three companies would have access to the 75 salespeople employed by the newspaper. Storer said he plans to hire up to 20 people over the next 18 months.
Distribion, Vertical Nerve and Marketing FX are expected to bring A.H. Belo between $9 million and $11 million in revenue this year. The move was part of A.H. Belo’s long-range strategy to diversify and reduce reliance on print advertising revenue, and the acquisition was funded through the sale of two of its newspapers, the Providence Journal and Riverdale Press-Enterprise. Print advertising revenue at A.H. Belo declined nearly 10% from January through September in 2014 compared to the previous year.
Grant Moise, senior vice president of business development for The Dallas Morning News, told NetNewsCheck.com that the acquisition “provides us with an opportunity to provide more advanced products and services than we have in the past and offer those products to the full gamut of our advertisers.”