Current Southern California newspapers could combine to form one super-regional operation.

Platinum Equity, financial swingers from Beverly Hills, bought the Union-Tribune in March of 2009 for a song. Now San Diegans wonder if that song is “A Cottage for Sale.”

On July 11 of this year, the U-T reported that Platinum had hired investment banking firm Evercore Partners to “help evaluate strategic alternatives.” Nine times out of ten, such an announcement is the equivalent of hanging out a “For Sale” shingle. That would be particularly true of a private equity firm such as Platinum. Such outfits buy assets to sell them. Platinum’s philosophy is to buy mixed-breed pooches and sell them as Thoroughbred racehorses. Its normal holding period is three to five years.

On July 16, a maudlin missive was printed in the U-T under the name of publisher Ed Moss. He promised that the newspaper would be doing great things for San Diego and then stated, “Our commitment to the San Diego region is steadfast…San Diego County is our home.”

Huh? Such a statement can be read several ways, but it would suggest that the newspaper — if not Platinum — is remaining in San Diego. (Of course, liar’s poker is a favorite game among investment bankers, so possibly very little should be read into Moss’s so-called commitment.)

However, I do think it is possible that Platinum and the U-T will remain. It’s plausible that media moguls are huddling to combine papers in Southern California. The U-T, Orange County Register, Los Angeles Times, Riverside Press-Enterprise, and papers belonging to the MediaNews Group could combine into one operation — although it’s not likely that they all would join in.

The papers would probably be printed in one or two locations. There might be a central copydesk. Certain stories would run in every paper. Accounting, circulation, and sales functions could be integrated. Employment would be slashed.

But where would the money come from? Freedom Communications, parent of the Orange County Register, emerged from bankruptcy last year and is trying to sell its 100 papers, including 27 dailies, along with 8 television stations. Tom Gores, head of Platinum, and his brother Alec Gores, also an investment banker, are said to have bid together for part of Freedom. (Platinum won’t address the point.) Freedom and MediaNews have been flirting off and on.

The Los Angeles Times’s parent, Chicago’s Tribune Company, is slogging through one of history’s messiest bankruptcies. It is now going through another round of layoffs. Denver’s MediaNews Group owns several Southern California papers, including the Long Beach Press-Telegram, Pasadena Star-News, Los Angeles Daily News, San Bernardino Sun, and the Torrance-based Daily Breeze (once owned by Copley Newspapers, the U-T’s former owner). MediaNews went through bankruptcy last year, giving its lenders equity in lieu of a slug of debt.

None of these companies has the financial muscle to control an agglomeration of Southern California newspapers. So Evercore’s job might be to find an investor, or more likely a combination of investors (private equity groups, hedge funds, etc.) to supply the capital for the undertaking. Possibly the effort could be coordinated among existing companies, but that’s not likely.

Or the Union-Tribune might actually be for sale. There was a rumor to that effect more than a month ago. Platinum Equity claims that it has made the newspaper profitable; cash flow (money in, money out) is supposed to be fat. However, daily circulation has plunged from 261,253 when Platinum bought it to 204,967. Given the thinness of the papers, it seems unlikely that advertising revenue has grown much, if at all, and may have declined. If the paper is in fact profitable, huge personnel cuts are almost certainly the main cause. Adoption of new technologies has probably not enhanced profitability significantly.

And private equity groups are notorious for using old technologies — such as a pencil and eraser — to make it appear that profits are blossoming, when in actuality the accounting has been changed.

Platinum paid about $50 million — and possibly as little as $30 million — for the newspaper and real estate with assessed valuations of more than $100 million. Platinum expected to dump the real estate for a quick, fat profit, but the market remains anemic.

Last year, Tom Gores told Mergers & Acquisitions magazine, and posted on the Platinum website, that the U-T under Copley was “a bit fat, so we’ve made the paper more efficient in terms of head count.” That’s a polite way to say employees were sent to the guillotine. Gores went on to say that Platinum bought the paper “at a reasonable value” and saw an opportunity to attack advertising and circulation revenue more realistically. He said it would take a big company to find a way to get readers to pay for online content.

Platinum management, while not answering the questions I posed, has said that acquisitions, partnerships, and divestitures could result from Evercore’s efforts.

Says Robert Emmers, spokesman for Freedom Communications, “A lot of observers and media experts have said there has to be some kind of consolidation for traditional media to survive. How it shakes out in Southern California is anybody’s guess.”

So Evercore may be in search of moneybags who will take this risk. That won’t be easy. In March, the Pew Research Center’s Project for Excellence in Journalism reported on last year’s state of the newspaper industry. As of 2010, newspaper advertising revenue was down 48 percent in four years. Typical newspaper profit margins last year were 5 percent — less than one quarter of what they were in the 1990s. Newspapers are surviving mainly by managing costs. The total audience for newspapers has declined sharply; papers can’t charge rates as high as they once did.

About 40 percent of Americans report they read any kind of a newspaper. That’s down from 46 percent in 2008 and 52 percent in 2006.

A month ago, pundits would say that the only media organization with the financial heft to take on Southern California papers is Rupert Murdoch’s News Corporation. But his shareholders don’t want him to buy any more papers, much as he loves the business. And he has other things to worry about right now — like a burgeoning phone-tapping scandal at a now-defunct paper in Britain.