The Beverly Hills equity firm purchasing The San Diego Union-Tribune and the firm’s partner, a Canadian publisher, are major players in their fields — buying things and printing newspapers, respectively — but both stay out of the headlines.

Platinum Equity is expected to complete its purchase of the U-T later this year. The U-T reports that Platinum Equity “worked with” David Black, president/CEO of Black Press. Black told the paper that “he would be on the newspaper’s operating committee but would have no day-to-day responsibilities.”

According to its website, Platinum Equity owns a long list of companies, although none are household names. They include technology firms, a crane rental company and an automobile wheel manufacturer.

The company’s motivation for buying the U-T is unclear. The website says the firm “sets a goal to improve the value of acquired companies in less than twelve months as part of its involvement in an operation’s long-term value creation.”

Rick Edmunds, a business analyst with the The Poynter Institute, a journalism think tank, wrote today that cuts at the U-T are likely but not inevitable:

For Platinum, this is almost certainly a straight business deal, not an exercise in community-spirited rescue. The company’s Web site says it specializes in out-of-favor companies facing big transitional challenges. Typically it operates them for a period of time, making major changes, often including dealing off assets, then sells at a higher price.

Usually, but not always, a private equity strategy is to cut more deeply than previous owners could stomach.

As for publisher David Black, it’s not known whether he or his company will have a stake in the U-T. Black Press, which owns about 150 weekly and daily newspapers in the U.S. and Canada, was one of the U-T’s early suitors.

Don Ward, who profiled Black in a Seattle Weekly article last summer, told me that the CEO appeared to be a consummate businessman whose priority is profit.

“The second thing about him is that he has an interest in hyperlocal journalism,” Ward said. “If you take a look at David Black’s newspaper, they follow the formula whether they’re in British Columbia or down here in Washington state.”

He added: “They cover the news in the community, the standard city hall, school board, local feature-type stories. My impression is that you’re not going to be seeing a David Black newspaper covering federal stories, state stories, stuff like that.”

Black clearly isn’t afraid to cut costs. “His most notable decision here was to close a money-losing daily that served one of Seattle’s suburbs,” said University of Washington associate professor of journalism Randal Beam in an e-mail. “He also consolidated printing operations for his other papers. Otherwise, he isn’t someone whose actions attract a lot of attention around here.”

Newspaper consultant Ken Doctor provides another perspective on Black Press, predicting that its involvement in the U-T purchase doesn’t bode well for newspaper employees. He writes in his blog today about Black Press’s purchase of the newspaper in Akron, Ohio:

What’s happened in Akron shouldn’t buoy hopes for Union-Tribune staff or for its readers.

Mainly, the Beacon-Journal, like most of its brethren, has gotten smaller. At least three rounds of layoffs have reduced the staff by more than a third. David Black himself, in recently visiting the paper, told people the newsroom looked “thin.”

In other ways, the Black ownership has been unremarkable. The Beacon-Journal has not distinguished itself in pushing its newsroom to embrace web-first, web-only, blog-friendly reporting. The online sales side is a work in progress.

Judging from Akron, we can intuit that the new private equity owners and David Black will look first to “efficiencies.” That means less headcount and a concentration on lower-paid, less-experienced reporting staff. Morale — never a newspaper strong suit — will take another hit.


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