Published: Thu, February 08, 2018
Finance | By Cynthia Curry

LA Times sold to billionaire for $500m

LA Times sold to billionaire for $500m

Chicago-based Tronc announced the sale of The Times and the San Diego Union-Tribune to Soon-Shiong's investment firm Nant Capital for almost US$500m (€406m) in cash.

Tronc plans to use the $500 million it will receive to repay the company's outstanding debt, in addition to reducing its pension liabilities and bolstering its cash position.

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.

Soon-Shiong is the latest billionaire to seek to turn around struggling newspapers, following on the heels of Amazon owner Jeff Bezos's purchase of the Washington Post and Boston Red Sox owner John Henry's deal for the Boston Globe.

The company also announced that Ross Levinsohn has been reinstated as LA Times CEO, after he agreed to take an unpaid leave of absence last month following disclosure of sexual harassment allegations against him while he worked at other companies.

Four years later, Ferro gained control of Tribune Publishing and renamed it Tronc - for Tribune Online Content.

While all print newspapers have grappled with the transition to the digital age, the problems for the Los Angeles Times were exacerbated by its own corporate dramas.

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The transaction could solve two problems for Tronc, which also owns the Chicago Tribune and the New York Daily News.

"We find ourselves returning to where we were a century ago when a handful of wealthy owners controlled big influential newspapers", Tompkins said.

The announcement Wednesday means that for the first time in 18 years the Times will be under local ownership.

In an interview with the Times past year, Soon-Shiong declined to say if he planned to buy the newspaper, although he acknowledged that as a major stockholder he was unhappy with the way it was being run and felt a need to ensure its survival.

Soon-Shiong, a South African-born surgeon, is part-owner of the Los Angeles Lakers basketball team and a founder of two drug companies, which he sold for a total of US$8.6 billion.

Tronc said the deal will allow it to follow a more aggressive growth strategy focused on news and digital media. Tronc is paying $66 million for a 60 percent stake in 4-year-old BestReviews. He was replaced by Jim Kirk, the former editor and publisher of the Chicago Sun-Times.

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.

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