Dow Jones & Co., publisher of The Wall Street Journal, announced Feb. 21 that it entered into a definitive agreement to sell four of its Ottaway Newspapers Inc. properties to Community Newspaper Holdings Inc. for approximately $182 million in cash.

The transaction is subject to regulatory approval and customary closing conditions and is expected to close by the end of the first quarter.

The properties to be sold are The Joplin (Mo.) Globe; The Daily Independent in Ashland, Ky.; The Free Press in Mankato, Minn.; and The Herald in Sharon, Pa. For the full year 2001, the four newspapers had combined revenues of $47 million and operating income of $12 million. Ottaway will continue to publish 15 daily and more than 30 weekly newspapers in 10 states, with combined 2001 revenue of $301 million and daily circulation of about 444,000.

“This transaction is one successful step in our long-range plan to increase shareholder value,” said Peter R. Kann, chairman and chief executive officer of Dow Jones. “Among our ten strategic priorities in this plan is further strengthening our diversified Ottaway newspaper portfolio through targeted divestitures, swaps and acquisitions. Overall and over time, we expect to be a net buyer of community newspaper properties.”

Tax implications of the sale have not yet been finalized, but Dow Jones estimates using about $117 million of its $485 million in available capital loss carryforwards to offset capital gains on the sales, resulting in an after-tax gain of about $118 million, or $1.39 per diluted share, and after-tax proceeds of $165 million. Proceeds will be used to repay debt, repurchase shares and acquire additional community newspapers. Excluding the gain on sale, the transaction is expected to be modestly dilutive to earnings per share in 2002, and accretive thereafter.

“After a review of all Ottaway newspaper locations, we have decided to focus our future growth outside of these markets, and to pursue newspaper acquisitions in other regions of the country,” said James H. Ottaway, senior vice president of Dow Jones and chairman and chief executive officer of Ottaway Newspapers. “I would like to thank the management and employees of these high-quality papers for their dedicated service to the communities they serve, and their contribution to the success of Ottaway newspapers and Dow Jones. I wish them well with CNHI, one of the largest and best-managed community newspaper companies in the country.”

Mike E. Reed, president and CEO of CNHI, said: “We are very happy to add these outstanding newspapers to the CNHI family. We anticipate no changes to the daily operations of the newspapers and look forward to continuing the tradition of serving their communities and customers.”

In addition to The Wall Street Journal, Dow Jones publishes Barron’s magazine, Dow Jones Newswires, Dow Jones Indexes and the Ottaway group of community newspapers. Dow Jones is co-owner with Reuters Group of Factiva, with Hearst of SmartMoney and with NBC of CNBC television operations in Asia and Europe. Dow Jones also provides news content to CNBC and radio stations in the United States.