Tribune Publishing, the parent company of the Los Angeles Times that was pushed out of the bigger Tribune Company nest last year, has acquired what remains of the old San Diego Union-Tribune newspaper. U-T San Diego, as it has recently been called, sold for just $85 million, in a deal that does not involve any real estate. When the Los Angeles Times was in growth mode during the Otis Chandler era, it coveted a foothold in San Diego in order to offer advertisers the entire Southern California market. In the late '70s, the Times opened a daily edition there but it never really caught on. Now Tribune Publishing will own both papers. LA Times publisher Austin Beutner will become publisher in San Diego as well, though he says they will remain separate news operations but might share some content. Add a new name to the local media landscape: California News Group, which Beutner will head.
Newspaper industry analyst Ken Doctor has been predicting this kind of consolidation in the Southern California newspaper field. He says that Beutner and Tribune Publishing CEO Jack Griffin believe in consolidation as a survival strategy. "Southern California, with a population approaching 20 million, is Tribune Publishing’s big play," Doctor wrote earlier today, before the actual announcement, which he knew was coming.
The sale – which I first outlined two months ago — will conclude an on-again, off-again auction. The sales process first started by developer and UT San Diego owner Doug Manchester last summer, has involved three sparring parties, the other two local.
The price compares to the $110 million that Manchester paid in 2011 to Platinum Equity — which had itself bought the company in a bottom-of-the-recession fire sale for about $35 million in 2009 from its longtime owner, the Copley family.
The buy would add the region’s No. 3 paper by print circulation to the Los Angeles Times, which despite many cutbacks over the years still dominates the print news scene in greater L.A. The Times can still claim a print circulation of 628,910 daily and 944,795 Sunday; U-T San Diego claims 268,038 on Sunday and 183,456 daily. (The Orange County Register counts itself barely ahead of U-T San Diego, at 302,802 Sunday and 192,567 daily. All counts are from the Alliance for Audited Media.) Of course, it’s the massive (but uneven) digital footprint of both the Times and the U-T that will matter most going forward.
And this big consolidation likely won’t be the last in the region. The Register, under new publisher Rich Mirman, still finds itself in the midst of financial triage, after the failed reign (“The newsonomics of The Orange County Register’s swerves all over the freeway”) of owner Aaron Kushner and executive Eric Spitz. As Mirman rationalizes both its ownership and operating plans, the Register is itself likely to be put up for sale, along with the Riverside Press-Enterprise that it bought only 18 months ago. Then there’s the hodgepodge of Los Angeles News Group (LANG) properties, about to be purchased by Apollo Global Management as it soon finalizes its acquisition of Digital First Media.
From the Times story, which features a photo of Beutner and quotes from the boss:
He said the U-T would remain a separate newspaper, with an “authentic voice” reflecting its community. Beutner pledged to preserve its editorial independence. He added: “I also know the Los Angeles Times will benefit from a closer connection with its older sibling down south.”
Executives at both papers are examining how operations can be consolidated. One possibility is that The Times will print the San Diego paper.
The U-T, whose roots go to 1868 and which was known until recently as the San Diego Union-Tribune, serves a metropolitan area of more than 3 million. It has 622 employees, 173 of them in the newsroom. The paper has won four Pulitzer Prizes, the most recent in 2009.
Jeff Light, president and editor of the U-T, described Tribune Publishing as “a good buyer” with “a tradition of journalistic excellence, along with the resources to move us forward.”