Tronc Inc., the parent company of the Los Angeles Times, is in advanced talks to sell the paper to local billionaire Dr. Patrick Soon-Shiong, according to NPR's David Folkenflik.
Confirmed: Tronc in advanced talks to sell LAT & San Diego U-T to Dr. Patrick Soon-Shiong, a SoCal billionaire and major Tronc investor— David Folkenflik (@davidfolkenflik) February 6, 2018
Folkenflik told KPCC that Tronc is trying to finalize the sale to Soon-Shiong.
"These are not just talks," Folkenflik said. "They're deep into negotiations even as we speak, trying to finalize this thing. I'm told it's much in progress, it's close. It's not done yet — things of course can fall apart until things are signed, sealed, and delivered, and they're a little shy of that."
Still, Folkenflik said, Tronc controlling owner Michael Ferro — and apparently his board — have every intention of selling to Soon-Shiong, Folkenflik said. While they had previously been allies, there has been division between Ferro and Soon-Shiong.
The L.A. Times is reporting that Soon-Shiong could pay $500 million for the paper and its sister publication the San Diego Union-Tribune.
Soon-Shiong is one of the richest people in L.A. A physician and biotech entrepreneur who's made his money in the health care industry, developing cancer drugs. But his pursuits in the field are vast and cover everything from genomic research to the development of health care software. His health care company NantHealth, only one of several operations that he owns, is based in Culver City.
He's one of the largest shareholders of Tronc, holding a 26 percent stake, and is part owner of the L.A. Lakers.
Among the issues roiling the Times is the turnover of executives following reporting by NPR's Folkenflik on allegations of sexual harassment. Times journalists also voted recently to unionize. One of their grievances is management's plans to hire nonstaff contributors for stories published online.
Soon-Shiong was born in South Africa, the Times' James Koren told KPCC, the son of Chinese immigrants. His father was an herbal healer. Soon-Shiong became a doctor and found his way to UCLA, where he developed a pancreas transplant program.
He went on to get into the pharmaceutical business, developing a cancer drug that combined two other drugs, Koren said. Soon-Shiong sold the company that developed that drug along with another pharmaceutical company for billions of dollars, which created the foundation of his fortune. Since then, he's gotten deeply into cancer research and genetic testing, with wide ranging interests in the biotech and health care technology space, Koren said.
Soon-Shiong is one of a few local billionaires who, over the years, have been rumored to be interested in the Times, Koren said. The others include Eli Broad, David Geffen and Ron Burkle. The Soon-Shiong fortune is newer than those other billionaires, so he has built less of a track record of philanthropy.
Soon-Shiong bought into Times parent company Tronc in the spring of 2016, Koren said. It was seen at the time as a way for the company to fend off a takeover bid by Gannett, but Koren's sources say that they expected that Patrick was buying into the parent company and eyeing the Times at the same time.
After investing in Tronc, Soon-Shiong expressed his interest to another Times reporter in preserving the integrity of the Times.
The mood at the Times is cautiously optimistic, according to Koren, with many believing that any local ownership is better than being owned by a company in Chicago like Tronc.
As the Post reports, the Times remains an attractive property:
"Despite declining print readership and advertising revenue throughout the newspaper industry, the Times remains a strong brand and the dominant daily in the nation's second-largest city. It is the sixth-largest daily paper as measured by print circulation, with 431,000 subscribers, according to the Audit Bureau of Circulation. It is also among the leading news providers online, with 31.6 million unique readers in December, according to ComScore."
Marisa Kollias, vice president of communications and public relations for Tronc, declined to comment when reached via e-mail.
Tronc, formally known as Tribune Online Content, also owns other major dailies including the Chicago Tribune, Baltimore Sun and New York Daily News.
Its forerunner, Tribune Co., bought the Times in 2000, and the ensuing years — coinciding with upheaval in the newspaper industry and declining readership — have been marked with tensions over numerous staff and spending cutbacks. At its peak in the late 1990s, the news staff was more than 1,000. Currently, about 400 journalists remain employed, the Post reports.
The news was first reported by the Washington Post.
This story has been updated.