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What: Shares of The McClatchy Company (NYSE:MNI) were rocketing higher today, gaining as much as 28% after a consortium it belongs to put up Cars.com for sale.
So what: McClatchy is one of five newspaper publishers belonging to the Classified Ventures consortium, which owns Cars.com, and the group is putting the website on the selling block for as much as $3 billion. McClatchy owns a 25.6% stake in the venture, meaning it stands to take home more than $750 million if Classified can find a buyer willing to shell out $3 billion. Last week, Classified announced it would sell another major asset, Apartments.com, for $585 million. So the joint venture will essentially be dismantled if the Cars.com sale goes through.
Now what: McClatchy shares jumped 8% the day the Apartments.com deal was announced, and at a current market cap of $600 million, the cash infusion from a potential Cars.com sale would have a huge benefit. The market for e-commerce websites has been heating up lately as rival AutoTrader.com was recently valued at $7.2 billion in equity sale, and McClatchy has at least part ownership in a number of other web properties including Careerbuilder.com, Dealsaver.com, and Homefinder.com. If the Cars.com sales goes through, don't be surprised to see those other websites go on the trading block, a move that should send McClatchy shares up even higher.
Jeremy Bowman has no position in any stocks mentioned, and neither does The Motley Fool. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.