Get Your Boston Herald…

First-round bids are due today for Herald Media Inc., which publishes both The Boston Herald and more than 100 community dailies and weeklies in Massachusetts. Most prospective buyers weren’t tipping their hands yesterday – either to me or to deal agent Wachovia Capital Markets – but expect both private equity firms and strategic buyers to take a shot. You might even see some pre-made combinations of the two, like the Enterprise NewsMedia LLC platform controlled by Heritage Partners. It already owns papers like The Patriot Ledger, and could be looking for some serious regional expansion (Heritage declined to comment on any aspect of the deal, including its level of interest). There also are a lot of other media-focused private equity firms in and around Boston that answered Wachovia’s teaser for the blue book, plus some firms a bit further south that have expressed some interest.

For the uninitiated, Herald Media was basically wholly-owned by publisher Pat Purcell until it decided to acquire the community papers from Fidelity in early 2001 for $150 million. To help finance the deal, Purcell enlisted a trio of private equity firms – Audax Group, BMO Halyard Partners and Weston Presidio -- to invest around $60 million. Those firms recouped around 90% of their commitments via a dividend recap last year, but in September told Purcell that they needed a complete exit due to basic fund-lifecycle/timing issues. Herald Media then retained Wachovia Capital Markets to and Dirks, Van Essen & Murray to pursue strategic options.

Since doing so, one giant question has swirled through Boston media circles: What exactly is for sale? Is it just the private equity consortium’s minority stake? Is it just the community papers? Is it also The Boston Herald itself?

The answer is that Wachovia is seeking bids for the entirety of Herald Media Inc., and that it hasn’t been too receptive to partial proposals. Why? Because, on a cash-flow basis, the community newspapers are the jewel while the Boston Herald is the millstone. As I’ve discussed previously, community papers continue to outshine most big city dailies because (A) They often has exclusive news-you-can-use content (school lunch menus, pee-wee football scores, church events, etc.) and (B) Their classifieds have not been cannibalized too much by Monster, Craigslist, etc. This dichotomy is particularly striking in the case of Herald Media, where the big-city daily is a secondary read that doesn’t have much home delivery distribution outside the city limits. It also has been hurt by a free tabloid partially owned by The Boston Globe (thus lessening the Herald’s number of subway/bus readers).

To reiterate, bids are due today. Expect offers anywhere from 9x-12x cash-flow, and a new Herald Media owner by springtime.

Unrelated: Actions Semiconductor Inc., a China-based chip design company, yesterday raised a $72 million IPO and finished slightly up on its first day of trading. Each of my news notes since Actions filed included the following line: “Shareholders include Tetrad Ventures Ltd. and Rich Dragon Consultants Ltd., while press reports have suggested that the company is closing in on $80 million in Series A funding, largely from U.S.-based firms.” It turns out that the Series A deal did close prior to the IPO (September, to be specific), but it actually was for $95.8 million. Paul Hsiao, a principal with New Enterprise Associates, says that participants included GIC, NEA and Intel Capital, and that it was a secondary purchase from family shareholders.