GateHouse Media shares jump: NYSE debut sees stock rise 18 percent

By Jesse Noyes

Boston Herald Business Reporter

Thursday, October 26, 2006 - Updated: 07:58 AM EST

GateHouse Media Inc.’s shares surged yesterday as the regional newspaper publisher’s stock traded for the first time on the New York Stock Exchange.

The Fairport, N.Y.-based company’s shares jumped 18 percent, closing at $21.17. GateHouse brought in $248.4 million in its first sale of shares Tuesday.

GateHouse’s shares were priced at $18 Tuesday, fetching the top estimate made in its prospectus for going public.

GateHouse - which owns 75 dailies along with shoppers and Web sites in smaller and medium-sized regions - enjoyed its first-day trading success at a time when many newspaper companies are struggling.

The company, which bought the Community Newspaper Co. chain of suburban dailies and weeklies from Herald Media earlier this year, has taken the tack of not carrying a big-city daily flagship. Instead, it focuses on suburban and community news.

But what really makes GateHouse attractive is its financial backer, New York private equity firm Fortress Investment Group, said Francis Gaskins, president of IPODesktop.com, an online independent research company.

Fortress has done well bringing several private companies public, he said.

"They’ve got a really hot hand," Gaskins said. "Fortress has total credibility now on Wall Street."

Fortress bought GateHouse last year for $527 million.