Los Angeles Times sold to local billionaire for $500 million
Los Angeles Times sold to local billionaire for $500 million
The agreement between Los Angeles-based medical entrepreneur Dr. Patrick Soon-Shiong and Tronc Inc. marks the latest instance of a rich, civic-minded individual buying a newspaper from a big corporation.
Soon-Shiong is a major shareholder of Chicago’s Tronc Inc., one of the richest men in Los Angeles and, according to Forbes, the nation’s wealthiest doctor, with a net worth of $7.8 billion.
The deal includes The San Diego Union-Tribune, various titles in the California News Group and the assumption of $90 million in pension liabilities.
Soon-Shiong takes over in a time of turmoil at the paper. The Times just replaced its top editor, the third switch at the position in the newsroom in six months. Publisher Ross Levinsohn had been on unpaid leave after revelations that he was a defendant in two sexual harassment lawsuits elsewhere. Tronc announced Wednesday that Levinsohn has been cleared of any wrongdoing and would be reinstated as CEO of its newly reorganized Tribune Interactive division.
Journalists voted last month to unionize for the first time in the paper’s 136-year history.
Clashes between the Los Angeles Times and Tribune Co., which changed its name to Tronc Inc., erupted not long after it acquired the West Coast paper in 2000. Staff at the Times bristled over what it considered a string of bad decisions made from hundreds of miles away in Chicago. Tronc owns the Chicago Tribune.
The editor of the Los Angeles Times, John Carroll, who led the paper to 13 Pulitzer Prizes, resigned under heavy pressure to cut staff. Before he left, he asked an old friend and billionaire philanthropist if he would consider buying the paper.
Publisher John Puerner stepped down at the Times, as did his successor, Jeffrey Johnson, shortly after.
Dean Baquet, who took over for Carroll, left after 15 months. He is now the executive editor at The New York Times.
The sale of the Los Angeles Times is in keeping with one of two trends in media ownership: big companies getting bigger and wealthy investors taking on newspapers as philanthropic endeavors, said Al Tompkins, a senior faculty member at the Poynter Institute.
In 2013, Amazon founder and CEO Jeff Bezos bought The Washington Post for $250 million. Boston Red Sox owner John Henry bought The Boston Globe for $70 million.
“We find ourselves returning to where we were a century ago when a handful of wealthy owners controlled big influential newspapers,” Tompkins said. “Here’s the difference: The ownership today does not promise lucrative returns. You take it over knowing it isn’t nearly as profitable as it might have been 20 or 50 years ago. Today it’s a thinner margin and it gets thinner every day.”
Soon-Shiong also holds a minority interest in the Los Angeles Lakers, acquired in 2011 from Magic Johnson, the team’s former superstar and current president of basketball operations.
In an interview with the Times last year, Soon-Shiong acknowledged that as a major stockholder, he was unhappy with the way the Los Angeles Times was being run and felt a need to ensure its survival.
“I am concerned there are other agendas, independent of the newspaper’s needs or the fiduciary obligations to the viability of the organization,” he said at the time. “My goal is to try and preserve the integrity and the viability of the newspaper.”
After The Washington Post first reported a potential sale Tuesday, cheers spread through the Times newsroom.
Tronc said the deal will allow it to follow a more aggressive growth strategy focused on news and digital media. Acquisitions will continue to be a big part of its plan, Tronc said Wednesday, and the company announced that it’s buying a majority stake in online product review company BestReviews for an undisclosed amount.
The sale comes about a week after veteran Chicago journalist Jim Kirk was named editor in chief to replace Lewis D’Vorkin, whose short tenure was marked by clashes with staff.
Kirk, 52, had briefly served in the job during a management overhaul from August until November, when D’Vorkin joined the paper. D’Vorkin will stay on with Tronc as Chief Content Officer of Tribune Interactive, the company said Wednesday.
Reporters at the Times were alarmed by recent hiring of several news executives who reported to business executives, and not to news editors. That sparked fears the business side would wield undue influence in editorial matters. Traditionally, the editorial and business sides of a paper work separately to maintain journalistic credibility.
A return to local ownership would restore pride at the Times, said veteran media business analyst Ken Doctor.
The question is whether a new owner will do more than halt cutbacks by reinvesting, as Bezos and Henry did at their newspapers, to set the Times on a new path.
“Given the huge challenges still faced by news publishing in the age of Google/Facebook ad duopoly and still-onrushing digital disruption, even a billionaire has his work cut out for him,” Doctor said.
Facebook hires former UK deputy PM Nick Clegg as head of global affairs
- Facebook is enlisting the veteran of EU politics to help with increased regulatory scrutiny and challenges to its reputation
- Clegg described the new job as ‘an exciting new adventure,’ after 20 years in British politics
LONDON: Facebook Inc. has hired former British Deputy Prime Minister Nick Clegg to lead its global affairs and communications team, as the social network deals with a number of scandals related to privacy, fake news and election meddling.
The appointment makes Clegg, former leader of Britain’s Liberal Democrats and deputy to David Cameron in the 2010-2015 coalition government, the most senior European politician ever in a leadership role in Silicon Valley.
Facebook said Chief Executive Officer Mark Zuckerberg and Chief Operating Officer Sheryl Sandberg were closely involved in the hiring process, and started talking to Clegg over the summer.
“Our company is on a critical journey. The challenges we face are serious and clear and now more than ever we need new perspectives to help us though this time of change,” Sandberg said on a Facebook post congratulating Clegg.
Clegg, 51, succeeds Elliot Schrage and will report to Sandberg beginning on Monday. He will move to California with his family in the new year.
He was ousted as deputy prime minister after the Conservatives won a majority in 2015 in an election that saw his Liberal Democrats suffer a significant loss of support.
Clegg, whose appeal to younger voters was critically damaged when he broke a promise not to raise student tuition fees, lost his own seat in Britain’s parliament in an election last year.
He apologized in 2012 for breaking his promise on student charges, saying “I will never again make a pledge unless as a party we are absolutely clear about how we can keep it.”
Clegg is joining a company that has apologized for its mistakes and has promised to do better on many occasions, for example for breaching its users’ trust.
“Throughout my public life I have relished grappling with difficult and controversial issues and seeking to communicate them to others,” Clegg said in a Facebook post.
“I hope to use some of those skills in my new role“
Clegg, a strong advocate of Britain’s membership of the European Union, said it was a “wrench” to be leaving the public debate at a crucial time in Brexit, but added that key decisions would pass to parliament, of which he was no longer a member.
He will join his Liberal Democrat colleague Richard Allan at the social network.
Allan, a member of parliament between 1997 and 2005 who now sits in the upper house, is Facebook’s vice president of public policy for Europe, Middle East and Africa.
Clegg has discussed online security and privacy, both when in office and more recently in newspaper articles.
“I’m not especially bedazzled by Facebook,” he said in an article in the London Evening Standard in 2016.
“While I have good friends who work at the company, I actually find the messianic Californian new-worldy-touchy-feely culture of Facebook a little grating.”
He also said he was not sure that companies such as Facebook really pay all the tax they could, although he added that was as much the fault of governments that still hadn’t got their tax act together.
Schrage, who led the social network’s response to its several scandals, stepped down from the role in June after a decade with the company. Schrage will stay as an adviser, Facebook said.
Facebook has faced a barrage of criticism from users and lawmakers after it said last year that Russian agents used its platform to spread disinformation before and after the 2016 US presidential election, an accusation Moscow denies.
In March, the company faced new scrutiny over how it protects personal information after acknowledging that the data of up to 87 million people ended up in the hands of political consultancy Cambridge Analytica.