Local Chinese Billionaire Patrick Soon-Shiong buying L.A. Times, San Diego Union-Tribune

The Los Angeles Times will return to local ownership after its parent company agreed to sell its flagship publication to Patrick Soon-Shiong for $500 million.

The Chicago-based owner of the Los Angeles Times completed its sale of the newspaper on Wednesday in a surprise move that probably spells the end of its long-troubled relationship with Southern California’s leading news outlet.

The buyer is Patrick Soon-Shiong, a Los Angeles-area physician and a major shareholder of the paper’s former parent company, Tronc. Soon-Shiong is the billionaire founder and chief executive of NantHealth, based in Culver City. As part of the $500 million deal, he will also buy its sister newspaper, the San Diego Union-Tribune. News of the sale was first reported by The Washington Post on Tuesday afternoon.

The past few months have been particularly chaotic at the Times, with rapid turnover in the paper’s top ranks and a major clash between management and journalists over a proposal to have more non-staffers contributing more news content.

Ever since Tronc’s forerunner company, Tribune Co., acquired the Times in 2000, the newspaper and its parent company have engaged in a cross-country feud about the paper’s management and direction. As newspapers have declined in the digital age, the company has ordered round after round of cutbacks, prompting complaints that Tribune was decimating one of the nation’s most accomplished journalistic institutions.

The paper’s future has been clouded since Tribune Co. filed for bankruptcy court protection in 2008. Although the company eventually emerged from bankruptcy in 2012, the Times has shriveled. Its news staff has been pared to about 400 from more than 1,300 at its peak in the late 1990s.

The paper’s journalists voted overwhelmingly last month to form a union. Their immediate concern is the company’s nascent plans to establish a network of non-staff contributors to produce stories outside the main newsroom, which some fear would be a “scab” operationdesigned to undermine the union.

Tronc — short for Tribune Online Content — also owns the Chicago Tribune, Baltimore Sun and New York Daily News, among other papers. It is controlled by a Chicago investor, Michael W. Ferro. However, Ferro’s control has been contested by Soon-Shiong, who has challenged Ferro on several issues, including his spending on private jet travel and other corporate perks.

Dr. Patrick Soon-Shiong arriving at Trump Tower in New York in January 2017 for a meeting with the president-elect. (Evan Vucci/AP)

A representative for Soon-Shiong said he was traveling and could not comment on the purchase.

Soon-Shiong, 64, made his fortune — estimated at around $9 billion by Bloomberg — by starting and selling biotech companies and by operating an empire of interlocking enterprises. A surgeon by training, he has no background in newspapers, except as an investor in Tronc. Among his investments is a small stake in the Los Angeles Lakers.

He has vowed to “solve health care” and to “win the war on cancer,” two grandiloquent claims that have made him controversial within health-care circles.

Soon-Shiong advised Donald Trump on health-care issues during the presidential transition last year, and also consulted with former vice president Joe Biden on Biden’s cancer initiative. Soon-Shiong has directed his political contributions primarily to Democrats, including Hillary Clinton in 2016.

Despite declining print readership and advertising revenue throughout the newspaper industry, the Times remains a strong brand and the dominant daily newspaper in the nation’s second-largest city. It is the sixth-largest daily paper as measured by print circulation, with 433,134 weekday subscribers on average and 718,774 on Sundays, according to the Alliance for Audited Media. It is also among the leading news providers online, with 31.6 million unique readers in December, according to ComScore.

“It’s still very big and has a great franchise,” said Rick Edmonds, the media-business analyst at the Poynter Institute, a journalism education organization. He said the paper remains profitable, despite its deterioration. “I think they could get a pretty good price. It’s an attractive property.”

Although Tronc doesn’t detail the financial performance of each of its papers, Edmonds estimates that the Times accounted for between 30 and 40 percent of the company’s overall revenue. Tronc reported revenue of $353.1 million in its most recent quarter, down 7 percent. It was barely profitable, earning just $2.1 million, compared with a loss of $10.5 million in the same period a year earlier.

You may also like...

Leave a Reply

Your email address will not be published. Required fields are marked *