The last pieces of Freedom Communications, including the Orange Country Register, have been sold to 2100 Trust LLC, an investment group led by Aaron Kushner, a Boston-area business man who initiated the purchase last month.
I took a stab at figuring out how big a deal this was, but no confirmation of my back-of-the-envelope math is forthcoming, as the deal size wasn't disclosed by Freedom or Kusher's group. The OCR's Mary Ann Mibourn did confirm an aspect of the purchase:
As part of the deal, Freedom Communications will make an additional one-time contribution to the company's retirement plan. The amount of the contribution was not disclosed.
This contribution was reportedly a dealbreaker for U-T San Diego owners Doug Manchester's ambitions to own two papers in Southern California. It could be a significant amount of money, beyond what 2100 Trust paid for the remnants of Freedom. As I wrote last month:
[T]here's the matter of a possible $100-million unfunded retirement liability that Kushner may have inherited from Freedom. This was evidently a dealbreaker for Manchester's effort to buy the OCR, as the U-T reported earlier this month:U-T San Diego had been interested in acquiring the Register, but last week CEO John T. Lynch sent a memo to U-T managers saying that after nearly six months of negotiations, talks had been terminated.
Manchester paid $100 million to acquire the U-T from a private equity group in 2011. It's possible that he overpaid, but at least we're getting a fix on what newspapers in SoCal are worth.
This is important because Tribune Co. was just approved by a bankruptcy judge to begin the process of exiting bankruptcy. That means that the Los Angeles Times will soon be in the hands of Tribune's senior creditors, a group made up of L.A. private-equity firm Oaktree Captial, JPMorgan Chase, and newspaper distressed-debt specialist Angelo Gordon. There's a good chance they'll want to sell Tribune's newspaper holdings. So if we can get a sense of how much Kushner paid for the OCR, knowing how much Manchester reportedly paid for the U-T, we can start to think about how much the LATimes could be worth.