Tribune selling 2 dailies to Hearst
EmptyCHICAGO -- Tribune Co. is selling two newspapers in southern Connecticut to Hearst Corp. for $62.4 million, the media conglomerate said Thursday, five months after it was forced to scrap their planned sale to Gannett Co. Inc.
The Tribune Co. said The Advocate of Stamford and the Greenwich Time, the two smallest of its 11 newspapers, will be managed by MediaNews Group Inc. under an existing joint venture agreement with Hearst.
Connecticut’s attorney general, however, said an investigation had already begun to determine if the sale violates antitrust laws.
“We’re investigating and will take whatever action is justified by the facts and the law,” Attorney General Richard Blumenthal said. “If there is a concentration of ownership and control, so that a number of existing sources of information in effect combine and collude, there could be effects on choices for consumers.”
The review began after The Hour Publishing Co., which owns The Hour in Norwalk and weekly papers in Wilton and Stamford, wrote to Blumenthal with concerns about being left at a competitive disadvantage.
Chicago-based Tribune had announced an agreement with Gannett in March to sell the two dailies, which have a combined circulation of about 39,000, for $73 million because they did not fit its strategic focus on larger publishing and interactive businesses. Less than a month later, Tribune Co. agreed to an $8.2 billion buyout in which it is to go private under the leadership of real estate magnate Sam Zell.
But the union representing The Advocate’s 36 reporters and photographers obtained a federal court injunction temporarily blocking the sale, citing Gannett’s plans to not abide by the existing contract. An arbitrator then ruled in April that the sale could not go through unless the buyer assumed the contract as a condition of the sale, which Gannett declined to do.
Efforts to resolve the issue with Local 2110 of the United Automobile, Aerospace and Agricultural Implement Workers of America failed, and the deal was scrapped in May.
Blumenthal said his office and federal antitrust authorities will have to clear the purchases of The Advocate and Greenwich.
Besides newspapers, Tribune owns 23 television stations and the Chicago Cubs baseball team, which it is selling under the agreement with Zell.
Privately held MediaNews is the nation’s fourth-largest newspaper company. Together with its affiliated companies, it publishes about 60 daily newspapers including The Denver Post and The Detroit News.
Hearst publishes more than a dozen newspapers including the Houston Chronicle and the San Francisco Chronicle, plus 19 magazines including Cosmopolitan, Esquire and O, The Oprah Magazine.
Barring legal issues, the deal is expected to close within the next few weeks.
Tribune shares rose 63 cents, or 2.2%, to $28.81 in afternoon trading.