The new company, Impremedia LLC, will bring together two of the oldest, leading Spanish-language newspapers in the nation, whose combined circulation exceeds 700,000 readers.
El Diario/La Prensa, owned by the investment firm CPK Media, reaches some 297,500 daily readers in the New York metropolitan area, and La Opinion, owned by members of the founding Lozano family, serves roughly 427,800 people in southern California.
Impremedia will continue to publish the two dailies separately, the company said.
"Our vision is to create a national group of Latino newspapers that cover issues impacting our community nationally, regionally and locally on a hard-hitting and timely basis," Jose Ignacio Lozano, who will serve as vice chairman of Impremedia, said in a statement.
The new company will give the papers better leverage with advertisers by offering them a national platform to reach a Hispanic population that is growing both in numbers and purchasing power.
"Together, we will be able to establish an effective platform with national scope for advertisers and marketers who wish to use the power of newspapers to reach the rapidly growing and influential Latino market," Lozano added.
The new company will be chaired by Steve Rader, a managing general partner of Los Angeles-based Clarity Partners, an entity of CPK Media, which bought El Diario/La Prensa for $19.9 million in July 2003.
"Bringing together the two oldest and most prestigious Spanish-language newspapers offering the greatest reach in the two largest markets automatically makes Impremedia the leading Latino newspaper company in the country," Rader said in a press statement.
Though the two papers cater to a Spanish-speaking audience, the readership in New York and southern California differ significantly. La Opinion's readers largely descend from Mexico and Central America while El Diario/La Prensa targets readers from Spanish-speaking Caribbean nations.
Lozano acknowledged the cultural differences, but dismissed concerns the combined company would encounter difficulties in reaching its more diverse audience.
"They have some unique challenges over there in how they respond to that change in the marketplace and evolve along with it," he acknowledged. "They have to be sensitive to the needs of those communities."
"We understand very clearly that while we speak one language, we are not one culture, and our newspapers will reflect and respond to the nuances of our distinct communities throughout the country," he said in a press statement.
Lozano, who will run day-to-day operations of the new company, told Reuters the new company does not plan to start a national Spanish-language newspaper, but will consider buying or starting new newspapers in areas where Spanish-speaking populations are growing.
"Our goal is to create a chain of independent newspapers," he said. "Our overarching goal is to participate in the key markets of Hispanic population and the fastest growing markets that will be key markets in the future."
Lozano declined to specify which markets Impremedia would target but said it would be reasonable to assume it would seek to be in expanding Hispanic cities.
According to the latest Census Bureau figures, New York, Los Angeles, Chicago and Houston have the largest Spanish-speaking populations.
Hispanics, the nation's largest minority, make up about 13.5 percent of the U.S. population of more than 292 million.
Indeed, advertisers are paying closer attention to the growing Hispanic market, according to a report released Thursday from TNS Media Intelligence/CMR, a leading tracker of ad spending.
The report estimated that ad spending in the Spanish-language market will jump 15.7 percent next year.
English-language newspaper companies are also entering the Spanish-language newspaper market. Last year, Belo's The Dallas Morning News and Knight Ridder's Fort Worth Star-Telegram started battling for Spanish-language readers with their respective Al Dia and Diario La Estrella daily newspapers.
In Chicago, home to about 1.6 million Hispanics, the Tribune Company relaunched its weekly Spanish-language newspaper, Exito, as a daily paper renamed Hoy.
In Miami, the lead Spanish-language daily is El Nuevo-Herald, Miami Herald's sister paper, owned by Knight Ridder Company, with a circulation of over 90,000.
The number of Spanish-language newspapers in the United States has more than doubled from 232 in 1970 to over 500 in 2003, according to the December 2003 issue of Hispanic magazine.
As part of the La Opinion-CPK merger, La Opinion said it would buy back an equity investment held by Tribune Company, with financing from CPK. The transaction formally dissolves the companies' partnership, which began when Tribune in June 2000 bought Times Mirror Company, which had first invested in La Opinion in 1990.