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Belo Finally Has Post-Breakup Gain Via Gannett: Chart of the Day

Belo Corp.’s most steadfast shareholders were made whole more than five years after the media company got out of the newspaper business, and they have Gannett Co. to thank.

Belo owned the Dallas Morning News and other papers before a separation in February 2008. The publishing operation became A.H. Belo Corp., which had been the corporate name before the initials were dropped in 2001. Belo was left with television stations and cable-news channels.

As the CHART OF THE DAY shows, Belo’s shares traded for more than their pre-breakup price yesterday, when they climbed 28 percent. That hadn’t happened since the first week after the separation. The catalyst was a $1.5 billion takeover offer from Gannett, the publisher of USA Today and owner of 23 TV stations.

Although A.H. Belo also rose yesterday, the 0.3 percent gain was too small to lift the stock above the price where it began trading. Its decline since becoming a stand-alone company was 58 percent, as the chart shows. A.H. Belo and Belo are both based in Dallas.

Gannett, based in McLean, Virginia, agreed to buy Belo for $13.75 a share. The offer is 7.6 percent more than the stock’s adjusted price at the time of the breakup, according to data compiled by Bloomberg.

Belo might have risen above the adjusted price even without the deal, according to Edward Atorino, an analyst at Benchmark Co. in New York. His 12-month estimate for the stock was $13, and he reaffirmed the projection four days ago in a report.

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