Melodrama at tronc as major shareholders fight over LA Times
Morning Brief: Meanwhile, still no word from the board of Time Inc. as first quarter earnings reports will soon be coming out, giving the industry a clue as to whether 2017 will be a great year for publishers or M&A professionals
The Trump administration through a load of cruise missiles at an air base in Syria and now the media is in love with Trump. It won’t last, but you can’t say the media doesn’t love war, even a phony one.
The New York Times (along with CNN) is the biggest supporter of war in the US. Their problem is that they really wouldn’t want to gush too much this morning, so they are letting a contributor do it, leading with a column that starts out “President Donald J. Trump was right…” Who cares what sort of analysis follows that, the NYT editors get to beat the war drums for a day. By the end of the weekend we will be back where we started, so enough about Syria. We still won’t let Syrian refugees into the country so don’t tell me about our concern for chemical attack victims.
There is still no word on whether the board at Time Inc. will be approving a sale. Likely someone wants to see those first quarter numbers.
But over at tronc, the publisher of the LA Times and Chicago Tribune, they are having a good, old fashioned shareholder dispute, with the number one and two largest shareholders arguing over… just about everything.
Patrick Soon-Shiong, the LA billionaire brought in to fight off the Gannett attempted takeover, is proving a thorn in the side of Michael Ferro, the millionaire brought in to shore up Tribune Publishing. Tribune Publishing is now gone, absurdly renamed tronc, and gone is the management team that started the whole thing. (The former CEO, Jack Griffin, works for an M&A firm now.)
It’s probably a good time to remind readers that I warned that the company would not be in a rush to be sold. We’re talking about Chicago owners here, not east or west coast. The difference is that on either coast investors like to get in and out of deals fast. Here in flyover country ownership is like a trophy, tightly held and rarely surrendered (think Groupon). It makes for bad business, but great talk at the country club.
Go ahead and try to buy us, Tribune parent tells dissident investor
The Los Angeles Times isn’t for sale, but its Chicago-based parent company today invited billionaire biotech titan Patrick Soon-Shiong to bid for the entire newspaper chain…
…Apparently, Soon-Shiong sought to buy California’s biggest newspaper late last year, according to a letter today from Tronc to his attorney. “As was discussed with your client in December of 2016, the only way for your client to own the LA Times is to acquire the whole company,” Tronc’s lawyer said in the letter, obtained by Crain’s. “And if your client wants to make such a proposal, the board will do its duty and consider it.”
New Tronc Fusillade Targeting Soon-Shiong Gets to Core Question
Tronc re-engaged in a war of words Thursday morning, as it told its now disgruntled, soon-to-be-ex Vice Chairman Patrick Soon-Shiong to put up or shut up in a new letter from its attorney, Yosef Riemer of Kirkland & Ellis. As Tronc’s legal counsel launched the new fusillade, addressed to Soon-Shiong’s attorneys at Quinn Emanuel, further detailing Soon-Shiong’s alleged violation of company policies in buying Tronc shares, they got to the core of the battle: Who will own the Los Angeles Times…
…For the past 10 days, Tronc, led by Chairman Michael Ferro, its largest shareholder, has engaged in a public exchange of allegations with Soon-Shiong, the second-largest shareholder, through their attorneys. That exchange mimics, in vitriolic tone, last year’s oh-so-hostile battle as Gannett (GCI) , the country’s largest daily newspaper publisher, tried to buy Tronc, the second-largest publicly owned newspaper chain.
This thicket of allegations, one more tangled than last year’s with Gannett, likely will serve merely as prologue for a contest for ownership.
The story right below this morning’s brief is about the closing of a small paper in Cornwall, the Sunday Independent. Searching for a headline I wrote “Big newspapers get noticed when there are layoffs, the small one simply slip away, never to return” – it fit nicely, which is important to me (unlike most website editors), but has a bit of truth to it. Small papers tend to go away without much notice, while larger ones remain in the news as they cut their head counts.
Right on cue…
Tacoma’s News Tribune readies job cuts as top editor quits
Tacoma’s News Tribune, Washington’s second largest newspaper and a fixture in the Puget Sound region for more than a century, is preparing for job cuts in the newsroom.
Its top editor, Karen Peterson, is leaving as well…
…The cuts follow prior layoffs and buyouts at the paper in recent years.
The Bureau of Labor Statistics released March payroll numbers this morning and you can be sure that the story will be a tale of two political worlds: with one part bragging that under the new president the unemployment rate fell to a 10-year low of 4.5 percent, while the other points to the fact that only 98,000 jobs were added, far below expectations.
The fact is that sometimes the unemployment rate goes up when a lot of jobs are being created. The reason: unemployed workers, who had stopped looking for a job, reenter the job market. The opposite is also true, that when jobs are scarce some workers stop looking and fall off the report.
This report is odd in that the number of discouraged workers also fell, so read into the report what you will.
But 98,000 is still an incredibly low number, and not a good sign. But March also featured some amazingly bad weather in the east (if you remember, February was remarkably mild), so maybe this is just a blip. But it has to have the Fed wondering if following through with its interest rate hikes is really a great idea.