(Adds details of transaction throughout)
SAO PAULO, Sept 13 (Reuters) - Grupo Globo SA, Latin America’s largest media conglomerate, agreed on Tuesday to buy out the stake that partner Grupo Folha had in Valor Econômico newspaper for an undisclosed sum, as Brazil’s worst recession in eight decades forces publishers to shed jobs and sell assets.
In a statement published on the website of newspaper O Globo, Rio de Janeiro-based Grupo Globo said the transaction requires approval from antitrust watchdog Cade. Both Grupo Globo and Grupo Folha had a 50 percent stake each in Valor Econômico, which was founded in 2000 to focus on finance and economics news.
Grupo Folha, which is controlled by Brazil’s Frias family and owns the country’s largest paper in circulation, has cut coverage areas to reduce costs. Last week, employees at the flagship Folha de S. Paulo newspaper were told that several news departments would be folded into three different groups, according to sources briefed on the matter.
Folha’s decision to drop Valor coincides with traditional media companies facing more competition from the Internet for news. Newspaper circulation in Brazil has declined every year since 2012, forcing publishers to adopt paywall systems and offering a limited number of stories for free.
At the start of the decade, Valor spent heavily to set up a financial information terminal to cater to bank and fund clients, many of which have had to shrink operations amid a four year downturn. According to a Valor article published in May 2015, Valor spent about 150 million reais ($46 million) to establish the so-called Valor-PRO and online platforms.
Thomson Reuters Corp, the parent company of Reuters News, competes with Valor in providing financial data and news to investors.
Brazil’s media market is dominated by families, such as the Marinhos, who control Grupo Globo and command half of the printed editorial market in Brazil alongside the Civita family’s Grupo Abril SA.
$1 = 3.2690 Brazilian reais Reporting by Guillermo Parra-Bernal and Tatiana Bautzer; Editing by Grant McCool