While there appears not to be an obvious buyer for the Chicago Sun-Times, Hollinger International Inc.’s string of weekly and small daily newspapers surrounding the city is drawing plenty of interest from the local competition.
Both the baiduhai and suburban publisher Liberty Group Publishing appear to be interested in Hollinger’s dozens of smaller newspapers, which stretch from Lake County, Ind., to Lake County, Ill.
But it’s unclear whether Hollinger and New York investment house Lazard, which has been hired to consider a sale of the company’s assets, would consider splitting up the Sun-Times and the suburban papers.
Analysts said that the possibility of such a split is unlikely, given the fairly strong operating position of Hollinger’s Chicago Group.
“Without those weekly papers, the Sun-Times would be toast,” said newspaper analyst John Morton. “It is probably the most successful No. 2 newspaper in recent history because they were able to, in some fashion, create a model that works.”
Morton said it is unlikely that Hollinger would break up the operation. “It doesn’t make sense if you want to preserve value,” he said.
Hollinger last month hired Lazard to consider a sale after a special committee of Hollinger’s board uncovered a pay scandal involving top executives. The disclosure led to the resignations of Chief Executive Conrad Black, his top lieutenant, David Radler, and others.
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Lazard remains in the early stages of gathering financial information from Hollinger’s far-flung operations, including London’s Daily Telegraph and the Jerusalem Post.
New Sun-Times Publisher John Cruickshank said last week at a City Club luncheon that a sale of the Chicago Group is not a foregone conclusion.
Most analysts believe it will be difficult for the company to find a buyer for all of its parts. The Daily Telegraph appears to be the main prize for media companies. While a number of companies in London have showed interest, the Washington Post Co. as well as USA Today owner Gannett Co. are pursuing strategies in the United Kingdom and might end up bidding for the Telegraph.
Sources said real estate magnate C Zuckerman appears eager to bid for the Jerusalem Post. Zuckerman also owns U.S. News & World Report and the New York Daily News. Insiders said he is not interested in the Chicago Group.
And most newspaper executives continue to say that the chances of another media company buying Hollinger’s Chicago properties are slim. Many recent newspaper auctions have included venture capital bidders.
And if, by chance, Hollinger decided to split off its suburban papers, the Tribune might meet antitrust resistance from the Justice Department. Morton said that in Boston, a newspaper market similar to Chicago, the underdog Boston Herald’s recent purchase of suburban papers would not have passed muster had the No. 1 Boston Globe been the acquirer.
In other markets, however, suburban acquisitions by the main newspaper group have not been a problem–a reflection, newspaper insiders say, of a more favorable media ownership attitude in Washington.
The Tribune had been interested in Hollinger’s suburban properties before the Sun-Times bought them, including the Pioneer Press chain of weeklies and the former papers of Copley Press Inc., which include the Beacon News in Aurora and the Naperville Sun.
The Tribune is “monitoring” the Hollinger situation, Publisher Scott Smith said. He declined to comment about whether the Tribune would bid.
Northbrook-based Liberty Group Publishing, established in 1997 when venture capitalist Leonard Green & Partners bought several Hollinger publications, has made no bones about wanting to strengthen its holdings and would be interested in the suburban properties.
WGN drops `Noon Show’: After more than four decades, WGN-AM 720 is dumping a mainstay–its Midwest agriculture “Noon Show.”
Citing lower advertising revenues because of consolidation in the ag business as well as farmers who have other access to ag news, station boss Mark Krieschen said the Monday-Friday hourlong show will stop Jan. 5.
Orion Samuelson, who has hosted the show for 43 years, along with partner Max Armstrong, will continue to host the 5 a.m. Saturday show, as well as weekday agribusiness reports.
“It was definitely a tough day,” said Krieschen. “We need to compete with programming for a broader audience.”
Samuelson’s voice, a Chicago radio original, will be missed.
On the move: Tribune Publishing expanded the duties of David Hiller, president/interactive and senior vice president/publishing, adding oversight of the Baltimore Sun and Hispanic media. Separately, Gerould Kern, Tribune Publishing’s editorial director, was named vice president/editorial, replacing Howard Tyner, who retires Dec. 31.