PORTLAND – An investment group has signed an agreement to purchase Blethen Maine Newspapers, which owns the Portland Press Herald-Maine Sunday Telegram, the Kennebec Journal in Augusta, the Morning Sentinel in Waterville and other media in the state.

The prospective buyer, Maine Media Investment LLC, includes former Defense Secretary William Cohen, and business associates Robert Baldacci and Michael Liberty. The senior operating partner is Richard Connor, a Bangor native who is editor and publisher of The Times Leader in Wilkes-Barre, Pa.

Neither side disclosed the price or other terms of the agreement.

Employees were told about the development Wednesday afternoon. The deal is not complete and the final sale may be months away.

The Seattle Times Co., parent company of Blethen, announced plans to sell its Maine media holdings eight months ago. In July, Blethen said it had signed a letter of intent to sell to Maine Media Investment, and the parties have conducted talks since then.

While the economic downturn has tightened credit, both sides said they are hopeful the sale will go through.

“Although the sale is still contingent on the buyer obtaining a portion of its financing, both parties are optimistic that the transaction will close, despite tight credit markets,” said Charles Cochrane, president and chief executive officer of Blethen Maine Newspapers.

Connor said Wednesday it’s too early to speculate about what changes the new owners might make to staffing, operations or production at the Maine papers, which have cut jobs, closed bureaus and trimmed expenses throughout 2008.

“Until I’m inside the building every day, I can only guess what we might do differently,” Connor said.

Outside observers said finding credit would be a big challenge.

“The deal could fall apart, unless they have their financing lined up,” said Jennifer Saba, associate editor of Editor & Publisher magazine. “The fact that they don’t have their financing is a red flag for me.”