Posted: Wednesday, February 7, 2018 – 2:23 PM
(CNS) – Biotech billionaire Patrick Soon-Shiong has agreed to purchase the Los Angeles Times from its parent company Tronc, restoring local ownership and perhaps ending a turbulent period for the 136-year-old institution.
Chicago-based Tronc on Wednesday confirmed the deal to sell The Times and the San Diego Union-Tribune to Soon-Shiong’s investment firm Nant Capital for nearly $500 million in cash. In addition to the purchase price, the deal includes the assumption of $90 million in pension liabilities.
“We look forward to continuing the great tradition of award-winning journalism carried out by the reporters and editors of the Los Angeles Times, the San Diego Union-Tribune and the other California News Group titles,” Soon- Shiong said.
The sale comes after a stormy period for the newspaper, which has seen three editors in six months, its publisher placed on unpaid leave amid a sexual harassment investigation, and a vote to unionize the newsroom.
The deal came together over the past five days and took many observers by surprise, according to The Times. Tronc had fended off previous efforts to buy the company outright or peel off the California newspapers. Tronc had insisted The Times was key to its growth strategy given its proximity to Hollywood, technology hubs and the Pacific Rim.
“This transaction allows us to fully repay our outstanding debt, significantly lower our pension liabilities and have a substantial cash position following the close of the transaction,” Tronc CEO Justin Dearborn said. “We will have a versatile balance sheet that will enable us to be even more aggressive in executing on our growth strategy as a leading player in news and digital media.”
Soon-Shiong is one of Los Angeles’ wealthiest residents and a minority owner of the Los Angeles Lakers. He’s the latest billionaire to buy a major newspaper. Amazon founder Jeff Bezos bought the Washington Post in 2013. That same year, Red Sox owner John Henry purchased the Boston Globe and, in 2014, Minnesota billionaire and Timberwolves owner Glen Taylor bought the Minneapolis Star-Tribune.
The nearly $500 million price tag represents a premium for the struggling media properties, The Times reported. Traditional publications have fallen out of favor on Wall Street amid plummeting print advertising revenue as marketers have been showing preference for Facebook, Google, Snapchat and other sites and away from magazines and newspapers.