Jack Griffin out at Tribune Publishing, Justin Dearborn appointed new chief executive
New chief executive officer comes in from Merge Healthcare as move is made shortly after Michael Ferro invested $44 million in company and was named chairman
Tribune Publishing this morning announced that Jack Griffin was being replaced as CEO of the newspaper publisher and in his place Justin C. Dearborn was named Chief Executive Officer and a Director. The move, essentially a boardroom coup, is effective immediately, and comes less than three weeks after the company announced that Michael Ferro had invested $44.4 million in the company and was being named chairman.
“The Board thanks Jack Griffin for his significant contributions and wishes him the best of luck in his future endeavors,” Ferro is quoted in the announcement.
Griffin, named CEO of Tribune Publishing at the time of the spin off from The Tribune Company, came from the magazine publishing industry where he was CEO at Time Inc. for a short time, but before that was at Meredith, and before that at Condé Nast. He was a New Yorker who was running a Chicago-based media company.
The new CEO comes off a similar position at Merge Healtcare, a company in which Ferro had a stake through his private equity company Merrick Ventures. Ferro was once chairman of Merge, though he resigned in 2013 after the company’s stock fell sharply.
“Although Merge’s second quarter results were very disappointing, I do not believe that the current trading price of Merge common stock reflects the Company’s inherent strengths, market position or long-term prospects.” Ferro said at the time. “While I have no immediate plans in this regard, over time, I intend to explore a variety of ways to increase shareholder value, including, possibly, a going-private transaction.”
Merge Healthcare was then sold to IBM in the fall of last year in a $1 billion deal.
Tribune Publishing, meanwhile, is in the middle of an effort to acquire the assets of bankrupt Freedom Communications, including the Orange County Register. Tribune currently owns both the Los Angeles Times to the north, and the San Diego Union Tribune to the south of the Register.
“I believe Tribune Publishing has a significant opportunity to leverage technology to increase the value of its content and distribution channels,” said Dearborn. “Although this is a different medium than my last technology company, it has the same challenge on how to create the highest value for our content.”
The connection between Dearborn and Ferro is Click Commerce, the company Ferro founded in 1994. The company was an early pioneer in the area business-to-business commerce. Ferro sold Click Commerce in 2006 for $292 million to Illinois Tool Works.
Tribune Publishing is scheduled to report earnings next week on March 2. Its stock, which began trading in 2014 at just over $24 a shared, is now just below $7.50.
Right now there is a bit of schadenfreude being felt on the west coast. Just last year Griffin fired Los Angeles Times publisher Austin Beutner when it appeared there might have been an effort to buy the Southern California properties out from under TPUB. That might not have been so bad a deal, though few wanted to mention it at the time. It would have brought in a huge cash infusion as TPUB started life deeply in debt.
But that didn’t happen and the conflict between execs led to Beutner being tossed aside. Ferro could return to the idea if his real goal here is control of the Chicago Tribune. Ferro, if you recall, was the main investor in crosstown rival the Sun-Times, and that purchase never felt to me to be about newspapering than about local prestige and power. Ferro, like many involved in local media in Chicago, is a northsider, which is what the Tribune has always represented The tabloid Sun-Times, on the other hand, has flip-flopped back and forth between being a liberal southside paper and being a right wing tabloid à la the NY Post (it was once owned for a short time by Rupert Murdoch).
In the meantime, Tribune Publishing has brought in a number of expensive executives from the east coast with few new initiatives to show for it. Today’s move, in other words, might make a few executive title holders free a little uneasy. They shouldn’t – after all, few executives leave their posts without having their pockets filled with enough green paper they can use to wipe away the tears (while frontline staffers are lucky to receive one week of pay for every year they have worked at the company when they are let go).
Update (Noon ET): On an otherwise down day for stocks, TPUB is trading slightly up this morning at $7.55 a share. Later update (4ET): TPUB could not hold its gains and ended the day trading at $7.21, down along with the rest of the market.