Tronc’s troubled ownership of the venerable Los Angeles Times is nearing a merciful end.
The company, once known as Tribune Publishing, announced a deal Wednesday morning to sell the paper to Patrick Soon-Shiong, a Los Angeles billionaire who — through his umbrella company, Nant Capital — invested $70.5 million in Tronc and joined the company’s board in May 2016.
Tronc also sold The San Diego Union-Tribune, which then-Tribune Publishing purchased in 2015, and other titles in its “California News Group” to Soon-Shiong.
The Washington Post first reported on Tuesday that Tronc “is expected to announce it is selling the newspaper,” scuttlebutt that was backed up by a story in the Times that said a $500 million deal was “nearing.”
Indeed, the deal, as announced was for $500 million in cash plus the assumption of $90 million in pension liabilities.
“We are pleased to transition leadership of the Los Angeles Times and The San Diego Union-Tribune to local ownership, and we are certain that the journalistic excellence in Southern California will continue long into the future,” said Justin Dearborn, CEO of Tronc. “This transaction allows us to fully repay our outstanding debt, significantly lower our pension liabilities and have a substantial cash position following the close of the transaction. We will have a versatile balance sheet that will enable us to be even more aggressive in executing on our growth strategy as a leading player in news and digital media. We have a pipeline of robust opportunities and M&A will continue to be a significant part of our future.”
Soon-Shiong added, “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.”
Tronc also announced on Wednesday that Ross Levinsohn, who took a leave of absence as publisher of the Times last month after a damning NPR report about his past conduct, has been re-instated. Levinsohn will serve as CEO of Tribune Interactive (TI), which Tronc said “will operate the digital functions of the company, as well as pursue strategic growth investments and acquisitions.”
“Following an independent investigation and a report to the Board of Directors finding no wrongdoing on the part of Mr. Levinsohn, the Board determined to reinstate Mr. Levinsohn and appoint him Chief Executive Officer of Tribune Interactive, LLC,” the company said in a release.
A doctor by trade, Soon-Shiong has feuded with Tronc’s leadership since becoming a minority shareholder and taking a 26 percent stake in the company. Soon-Shiong previously expressed interest in taking a larger stake in the company and purchasing the Times, but was rebuffed.
Tronc originally courted Soon-Shiong’s investment as a way of staving off a takeover effort from Gannett.
In the company’s May 2016 investment announcement, Tronc CEO Justin Dearborn called Soon-Shiong “an innovative and visionary leader with a proven ability to leverage technology and research to drive transformative change and create significant shareholder value.”
Feb. 7, 6:33 a.m. This story has been updated with the official announcement of the sale.