“Fort Worth and Dallas, about a million miles away,” Texas singer Jimmie Dale Gilmore croons, but Arkansas publisher Mitch Bettis knows better.
The cities sit cheek by jowl in the middle of a 7.6 million-population metropolitan statistical area, the fourth-largest in the country. And it’s fertile ground for Bettis’ second major media acquisition in less than two years.
The Arkansas Business Publishing Group owner, whose Five Legged Stool LLC bought out longtime principal owner Olivia Farrell and other investors in February 2019, was ebullient. He had just bought Scott Publishing of Fort Worth, a like-minded caterer to moneyed, educated and influential audiences.
Bettis also learned that week that the government had forgiven ABPG’s $824,600 Payroll Protection Program loan, more good news to call home about to the Little Rock newsroom after meeting the new Texas crew.
Gloria Fletcher, his newly hired Texas publisher, was also on the line. Once Bettis’ boss at GateHouse Media, Fletcher was Warren Buffett’s last publisher at the Tulsa World before Berkshire Hathaway Media sold it in January in a wider deal with Lee Enterprises.
A native Oklahoman, Fletcher said she and her husband, Terry, a farrier, will live in their RV while house-hunting.
Bettis began by talking numbers, including one he couldn’t address in detail: the purchase price of Scott Publishing. The Texas company’s flagship title, 360 West, refers to the highway dividing Dallas and Tarrant counties, and defines its audience. Publisher Jerry Scott, who founded the company in 2009, will help Bettis and Fletcher through the transition.
But the price is off limits. “I could be sued by letting out that information,” Bettis said. “But it wouldn’t be unfair to say it’s on par with the acquisition size of Arkansas Business [Publishing Group]. For context, ABPG has 25 products, an events division and a significant digital marketing effort.” Scott has five core products. “That should tell you how successful they’ve been, how well run they are. We’ve been able to align with a real star, a top-notch performer with beautiful, quality publications.”
Industry insiders said Five Legged Stool — named for Farrell’s and Bettis’ corporate commitment to employees, readers, advertisers, vendors and stockholders — could optimally stand to double its profits. Part of that equation will be leveraging the size of the DFW market and capitalizing on the Little Rock team’s expertise in digital revenue.
Bettis has dispatched Little Rock publishers Chris Bahn, Rachel Pitre and Mandy Richardson, as well as digital solutions chief John Tucker, to travel to Fort Worth to glean ideas. Writing and editing staffs won’t be mingled, Bettis said.
“This operation is quite impressive both in its products and the talent within these hallowed walls,” Fletcher said from Fort Worth. “As Mitch said, there’s nothing to fix. There’s an opportunity to link with some of the work ABPG has been doing in terms of verticals that could work well in greater Fort Worth.”
The PPP loan forgiveness strengthens ABPG’s position going into a new pandemic-related financing structure for the Texas deal, the Federal Reserve’s Main Street Lending Program. “We expected forgiveness because we spent the loan proceeds in the right way, under strict rules,” Bettis said. “Think payroll, think benefits and think rent for three months. The PPP was a really amazing program, a way for the government to help keep people employed.”
After going through the PPP process with Arvest Bank, Bettis saw a newsfeed item about the Main Street Program and quickly realized he had a prime candidate in ABPG, on a seven-year run of record revenue or profit. One of the program’s aims is to bolster businesses that were thriving before the virus, so ABPG’s strong run and record 2019 financial results were key pieces of the puzzle.
Bettis teamed up with Vernon Scott, central Arkansas market president for Citizens Bank of Batesville, who coordinated the new loan, under which the Fed offers bargain terms.
The immediate payoff is “a really successful brand with a long track record of really beautiful work west of Highway 360,” serving affluent readers “on the western half of DFW,” as 360 West’s motto puts it.
The search for expansion opportunities began back in February, Bettis said, but 360 West didn’t hit his radar until about April. He was immediately intrigued. “It really is a beautiful fit with what ABPG does. Their publications cater to the premium audience in a key part of the state. They’re educated decision-makers with high net worth, and that’s a language we know.”