LA’s Richest Man Sells Union-Tribune to Feared ‘Chop Shop’

San Diego’s daily paper of record, the Union-Tribune, was sold by billionaire owner Patrick Soon-Shiong and his family to MediaNews Group, owned by Alden Global Capital – a company that has come to be feared across the ever-dwindling newspaper landscape. 

Just 10 minutes after U-T staffers learned of the sale, they received an email notifying them of staff reductions to come, one staffer tweeted. Alden would offer buyouts “in an effort for staff reductions to be voluntary,” the email read. 

Alden was referred to as a ruthless corporate strip-miner “seemingly intent on destroying local journalism,” by one prominent media critic in 2018. But in a struggling local newspaper environment, it’s hard to tell the difference between strip-mining and regular mining.  

As ad revenues and circulation have declined at papers across the country, owners of all types have made cut after cut, even when it appeared news operations couldn’t get any slimmer. 

The country’s largest newspaper owner Gannett, for instance, has cut more jobs than Alden in recent years, said Ken Doctor, a former media executive and columnist, who has followed Alden closely. 

“People get confused because these people are cut-throat capitalists,” said Doctor. “But their papers are making money and they’re holding onto them for the time being.” 

The fear, of course, is that when revenues and circulation fall beneath a certain threshold, Alden will leave its papers for dead. Alden is the country’s second largest newspaper owner, behind Gannett. 

The Union-Tribune now has 108 editorial staff members; down from more than 400 in 2006.

The paper has had six owners since 2009, when the Copley family, which had stewarded it for decades, sold the newspaper and its Mission Valley headquarters to a private equity firm, Platinum Equity. Platinum slashed jobs but the paper stabilized.

Platinum also hired an editor in chief, Jeff Light, who remains the editor and now is also publisher of the paper. Platinum sold the newspaper and its building to developer Doug Manchester in 2011. He clearly wanted the real estate above all but he made major changes – changing the name to U-T San Diego, pushing the editorial page to support his vision for stadiums and politics but he kept Light in charge. 

Manchester flirted with selling the paper to philanthropists putting together a nonprofit but he kept the real estate and sold the paper to the Tribune Publishing company, where it joined the LA Times, Baltimore Sun and Chicago Tribune. Light remained in charge editorially. 

Tribune created the California News Group and combined the U-T’s print operation with the LA Times’ printing service, eliminating the blue-collar jobs and moving distribution to Los Angeles. The paper became known again as the San Diego Union-Tribune. Soon-Shiong owned a portion of Tribune Publishing and wanted to buy the LA times. In 2018 he purchased the LA Times and Union-Tribune for a total of $500 million. 

But after his first presentation to U-T staff, he largely ignored the paper. He made major investments in the Los Angeles Times, moving to a new office building, hiring dozens of new journalists and ushering in a transformation he said would modernize the entire news industry. Nothing much changed for the U-T through all of it. Where in LA, Soon-Shiong and his family had perspective about the region and its needs, they had little interest in San Diego issues or politics. At one point, Soon-Shiong explored, again, the idea of transferring the San Diego paper to a nonprofit or university, but those efforts never produced a deal. 

The paper has remained profitable but its legacy pension debts and the enormous cost of printing and distributing present a major challenge for future owners.

Last month, the LA Times announced a restructuring with dozens of layoffs. The U-T, again, seemed like an afterthought. But now it looks like managers were waiting for a deal to close. The U-T’s new owners referenced the LA Times’ restructuring in their note to their new employees. 

“No different than the changes announced last month at the Los Angeles Times last month, the U-T will also need to make some difficult staffing decisions as we assume management. Reductions will be necessary to offset the slowdown in revenues as economic headwinds continue to impact the media industry. We will seek efficiencies in business operations, distribution and production while striving to support and prioritize the robust local newsgathering needed to serve the communities that rely on the Union-Tribune for excellence in journalism,” the memo read. 

Light told us he was too busy to comment Monday. He told his own paper he was confident: “I’m grateful to the Soon-Shiong family, who were good owners. Now it’s time to start another chapter. As our staff knows, this isn’t an easy business, but I have a lot of confidence in the future of the Union-Tribune.”

The veteran courts and criminal justice reporter Greg Moran captured the feeling of many that the paper was an afterthought to the Los Angeles billionaire who owned it. 

“All we did at the [Union-Tribune] since [Soon-Shiong] bought us is be profitable, execute on a plan to transition to a digital op. Didn’t hemorrhage money like the LAT, didn’t get a boatload of hires. And for that, the richest guy in LA sells us to the biggest chop shop in journalism,” Moran wrote on Twitter.