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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) June 21, 2006
THE E.W. SCRIPPS COMPANY
(Exact name of registrant as specified in its charter)
| Ohio | 0-16914 | 31-1223339 | ||
| (State or other jurisdiction of incorporation or organization) |
(Commission File Number) | (I.R.S. Employer Identification Number) |
| 312 Walnut Street Cincinnati, Ohio |
45202 | |
| (Address of principal executive offices) | (Zip Code) |
Registrant’s telephone number, including area code: (513) 977-3000
Not Applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
| ¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| ¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Table of Contents
INDEX TO CURRENT REPORT ON FORM 8-K
| Item No. |
Page | |||
| 1.01 |
Entry Into a Material Definitive Agreement | 3 | ||
| 2.06 |
Material Impairments | 3 | ||
| 9.01 |
Financial Statements and Exhibits | 3 | ||
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Item 1.01 Entry Into a Material Definitive Agreement
On June 21, 2006, The E. W. Scripps Company (“Scripps”) agreed to sell certain assets of its Shop At Home television network to Jewelry Television. The transaction is expected to close in the second quarter of 2006.
Jewelry Television will pay Scripps $17 million for the assets, which include Shop At Home’s intangible assets, building and real estate, satellite uplink facilities, information technology systems, the network’s call center, Web site and production studios, and will assume a number of agreements that Shop At Home has with broadcast television stations and operators of cable and satellite television systems to carry the network’s programming. Jewelry Television has announced that it intends to continue scaled-down operations of Shop At Home.
The transaction with Jewelry Television does not include the five Shop At Home-affiliated broadcast television stations that Scripps owns and operates in San Francisco, Boston, Cleveland, Raleigh-Durham, and Bridgeport. Under the terms of the agreement with Jewelry Television, those five broadcast television stations will air a combination of Shop At Home and Jewelry Television programming while Scripps seeks buyers for the stations.
Item 2.06 Material Impairments
As a result of the agreement with Jewelry Television, Scripps has revised the estimated charge it expects to incur in the second quarter related to the Shop At Home divestiture. Scripps now expects to record a pre-tax charge of up to $70 million, between $35 and $45 million after-tax, reflecting operating losses, losses on the assets to be sold to Jewelry Television and cash expenditures associated with the termination of long-term agreements and employee termination benefits. The estimated range of amounts comprising the expected charge includes:
| Operating losses |
$ | 15.0 - 20.0 | million | |
| Loss on property and other assets |
20.0 - 25.0 | |||
| Employee termination |
10.0 - 15.0 | |||
| Termination of agreements not assumed by Jewelry Television |
5.0 - 10.0 |
Cash expenditures related to the termination of non-cancellable network distribution commitments and certain leases and employee termination benefits for Shop At Home’s 660 full-time employees are expected to be disbursed through the third quarter of 2006.
Item 9.01 Financial Statements and Exhibits
(c) Exhibits
| Exhibit Number |
Description of Item | |
| 99.01 | Press release dated June 21, 2006 |
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| THE E.W. SCRIPPS COMPANY | ||
| BY: |
/s/ Anatolio B. Cruz III | |
| Anatolio B. Cruz III | ||
| Senior Vice President and General Counsel | ||
Dated: June 22, 2006
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EXHIBIT 99.01
PRESS RELEASE
Jewelry Television to acquire Shop At Home network assets
| June 21, 2006 |
(NYSE: SSP | ) | |
| For immediate release |
CINCINNATI – The E. W. Scripps Company and Jewelry Television today reached agreement on a transaction that will result in Jewelry Television acquiring certain assets of the Shop At Home television network.
Jewelry Television will pay Scripps $17 million for fixed assets, including Shop At Home’s building and real estate, satellite uplink facilities, information technology systems, the network’s call center, Web site and production studios.
Jewelry Television also intends to assume a number of agreements that Shop At Home has with broadcast television stations and operators of cable and satellite television systems to carry the network’s programming.
The transaction is expected to be completed by the end of June.
As a result of the Jewelry Television transaction, Scripps is revising the estimated charge it expects to record during the second quarter related to the Shop At Home divesture. The company now expects to record an after-tax charge of between $35 million and $45 million compared with the previously anticipated charge of up to $60 million.
In a separate press release today, Jewelry Television announced that it intends to continue scaled down operations of Shop At Home and will retain a number of the network’s employees. Shop At Home employees retained by Jewelry Television will still be eligible for severance packages and career transition services from Scripps.
The transaction with Jewelry Television does not include the five Shop At Home-affiliated broadcast television stations that Scripps owns and operates in San Francisco, Boston, Cleveland, Raleigh-Durham, N.C., and Bridgeport, Conn. Scripps has retained the services of a broker and is actively seeking a buyer for the stations.
In the meantime, as part of the transaction, the five broadcast television stations will air a combination of Shop At Home and Jewelry Television programming.
Forward-looking statements
This press release contains certain forward-looking statements related to the company’s businesses that are based on management’s current expectations. Forward-looking statements are subject to certain risks, trends and uncertainties, including changes in advertising demand and other economic conditions that could cause actual results to differ materially from the expectations expressed in forward-looking statements. All forward-looking statements should be evaluated with the understanding of their inherent uncertainty. The company’s written policy on forward-looking statements can be found on page F-5 of its 2005 SEC Form 10K.
We undertake no obligation to publicly update any forward-looking statements to reflect events for circumstances after the date the statement is made.
About Scripps
The E.W. Scripps Company (NYSE: SSP) is a diverse and growing media enterprise with interests in national cable networks, newspaper publishing, broadcast television stations, electronic commerce, interactive media, and licensing and syndication.
The company’s portfolio of media properties includes: Scripps Networks, with such brands as HGTV, Food Network, DIY Network, Fine Living, Great American Country and HGTVPro; daily and community newspapers in 18 markets and the Washington-based Scripps Media Center, home to the Scripps Howard News Service; 10 broadcast TV stations, including six ABC-affiliated stations, three NBC affiliates and one independent; leading online search and comparison shopping services, Shopzilla and uSwitch; and United Media, a leading worldwide licensing and syndication company that is the home of PEANUTS, DILBERT and approximately 150 other features and comics.
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Contact: Tim Stautberg, The E. W. Scripps Company, 513-977-3826
Email: stautberg@scripps.com