Updated throughout: 9 a.m. Feb. 7.
It's a done deal: Los Angeles billionaire Patrick Soon-Shiong is purchasing the Los Angeles Times and the San Diego Union-Tribune from Chicago-based media company Tronc for $500 million in cash, returning the L.A. Times to local ownership for the first time in 18 years. On top of that price, the deal includes the assumption of $90 million in pension liabilities, the Times reported on Wednesday.
Updated throughout: 9 a.m. Feb. 7.
Soon-Shiong, a South African–born American physician, biotech magnate and investor, has been a major shareholder in Tronc, the former parent company of the Times and the Union-Tribune. He also owns a minority stake in the Los Angeles Lakers.
"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 in a statement released to the Times Wednesday.
Soon-Shiong, 65, is founder and chief executive of “next-generation” healthcare company NantHealth, based in Culver City. He owned 26 percent of Tronc shares, the Times said Tuesday, but he has been at odds recently with Michael W. Ferro, the Chicago-based majority shareholder and non-executive chairman of Tronc, particularly over how the Times was being run.
Soon-Shiong is one wealthy dude. Bloomberg estimated his fortune at $9 billion. L.A. Weekly published a story on Soon-Shiong in April 2017, stating that he was rich but no longer the richest person in L.A. — and that he was getting into some trouble with his “Cancer Moonshot 2020” campaign, his $12 million donation to the University of Utah and his recently public company, NantHealth.
However, the L.A. Times has seen its share of rough times lately, too. There have been three different editors over the past six months. Just last week, the Times named Chicago Sun-Times veteran Jim Kirk as editor in chief. Kirk, previously senior vice president of strategic initiatives for Tronc and, for a short time, interim editor in chief of the Times, replaced Lewis D’Vorkin, former editor of Forbes, who lasted only three bitterly contested months. (He has been booted upstairs at Tronc.) Among his many accomplishments, D’Vorkin berated his own staff and assembled a “shadow newsroom” of journalists and contributors who sought to create digital content for social media and mobile devices, separate from the efforts of the established newsroom.
Last month, the L.A. Times newsroom voted 248-44 to unionize and join the News Guild-Communication Workers of America. Times staffers were fed up with the way Tronc was handling the staff and its resources, cutting costs and pushing new-fangled digital strategies at every opportunity. (Can you say GIFs?)
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Oh, and they were also fed up with Ferro and his jet. As majority shareholder of Tronc, he reportedly paid himself $5 million for the first quarters of 2018, 2019 and 2020 for being a consultant through his company, Merrick Ventures, LLC, totaling $15 million. And Tronc spent $4.6 million from February 2016 through September 2017 to sublease and operate a Bombardier jet for Ferro.
On the same date the union votes were announced, Tronc placed the L.A. Times’ publisher, Ross Levinsohn, on an unpaid leave of absence for sexual harassment allegations at previous places of employment. He was alleged to have fostered a “frat-boy atmosphere” at his previous companies.
Levinsohn now will head a new division called Tribune Interactive, Tronc announced Wednesday. The company said an independent investigation into allegations of sexual harassment at previous companies found "no wrongdoing" by Levinsohn, the Times reported Wednesday.
Soon-Shiong's purchase of the L.A. Times, expected to close in April, means local ownership for Southern California's biggest news organization for the first time in 18 years. The Chandler family sold Times Mirror Co. to Tribune Co. in 2000, and since then, things haven’t quite been the same.