1. All the newspapers Berkshire Hathway is buying are modestly profitable according to Poynter Institute. They didn't buy the Tampa Tribune newspaper which is struggling.
2. Berkshire is also loaning $400 million to Media General at 10.5% interest. And providing a $45 million credit line. The interest on that loan will go a long way towards paying for the newspapers.
3. And on top of this, Berkshire is getting stock warrants equivalent to almost 20% of Media General. Media Generals stock prices are already up by 33%.
In essence, Berkshire has put in $600 million which will earn them about $60-80 million per year (from newspaper revenue and interest on the loan.) Gives them 20% of a media company with a market cap of $90 million and room to rise higher. And leaves with a $400 million loan which has to be paid back to them eventually.
This is a bloody genius deal.