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Hotelier and real estate magnate Doug (Papa Doug) Manchester is considering purchase of the Union-Tribune, VoiceofSanDiego.org is reporting this afternoon. More than a month ago, on September 29, the Reader, on this News Ticker, reported the rumor that Manchester might be buying the local newspaper. Manchester told the Voice that "There's lots of people interested in that asset. There has not been anything completed. We're looking at it. It's a very complicated transaction if it were ever to come to fruition." At the time of the Reader's report September 29, a spokesman for Platinum Equity, the current owner of the paper, stated, "We don't comment on market rumors, even when they're false." The implication was that the rumor was probably false.

After the Reader report, Rachel Laing, flack for Mayor Sanders, sent out a tweet saying, "That post was an absolute travesty of journalism!" (Thanks to Matt Potter for sending me her tweet and also for alerting me to the Voice's story this afternoon.)

In July, Platinum Equity hired Evercore Partners to help evaluate the U-T's future. (Evercore had been hired by Copley management when it wanted to sell the U-T.) As reported many times by the Reader, Platinum bought the paper for less than half the value of the real estate it received. The paper, which had been worth $1 billion five years ago, sold for just over $50 million and perhaps as little as $35 million.

Manchester's interest would almost certainly be in the real estate. Some people in the newspaper business suspect that the U-T might be the first major daily to jettison its print editions and go strictly online. In that case, the U-T would almost certainly abandon its building on choice real estate in Mission Valley and move to cheaper quarters. In fact, the U-T might move out of that building even if it continued to operate the print edition. Platinum bought several other buildings besides the Mission Valley property.

Pictured: Doug Manchester

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Comments

dwbat Nov. 7, 2011 @ 7:05 p.m.

"...the U-T might be the first major daily to jettison its print editions and go strictly online."

That is quite possible, since Platinum Equity acquired Quark in August. While we think of QuarkXPress [which I used when I was Associate Editor at Palm Springs Life magazine], it's their newer, evolutionary digital-publishing products that Platinum Equity wanted.

Their August 9 news release mentioned Quark's "software products that enable the creation, management, publication, and delivery of content across a variety of media including print, email, web, social media, and the next generation of e-reader, tablet, and mobile devices such as the iPad."

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Don Bauder Nov. 7, 2011 @ 9:56 p.m.

There was speculation to that effect at the time Platinum bought Quark. Best, Don Bauder

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SurfPuppy619 Nov. 7, 2011 @ 8:03 p.m.

Platinum Equity could sell the Mission Valley HQ for millions and move what is left of the UT to El Cajon, Lakeside or National City and come out millions in the black and STILL OWN the paper.

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Visduh Nov. 7, 2011 @ 9:11 p.m.

Is there really a market for that space in Mission Valley today? Real estate is in the tank overall, and even there in the tourist motel mecca, I'm not sure the land is worth all that much. I could see the paper moving out of there and getting newer, cheaper-to-operate presses. Those they now use are just about forty years old, and the setup was designed for a bigger product and more copies.

If Platinum can unload the albatross paper onto Manchester--who is showing signs of not being any where near as astute as he once way--they could probably get out from under the controversies that come with it. Manchester is welcome to it and to some of the land. Let's see just how big a fool he can be.

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Don Bauder Nov. 7, 2011 @ 10:04 p.m.

I simply can't see Manchester having any interest in owning a newspaper, even if he had nothing to do with running it. He is a real estate guy. Period. It's a bad market, yes, but that's when speculators with long horizons buy. Best, Don Bauder

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Don Bauder Nov. 7, 2011 @ 10:01 p.m.

The Mission Valley building was appraised at $92 million at the time that Platinum bought the U-T. Platinum wanted to rent out some of the floors but has never been able to find renters. The building, which went operational in 1973, could be a tear-down. The question is how much would Platinum get for that building in this lousy commercial real estate market. However, speculators like to buy when prices are low. There could be lots of variables. Over the last week, appraisers have been going through the U-T building, according to employees. The appraisers weren't experts in the newspaper industry; they were real estate-oriented bean counters. Manchester was seen in the building three times in the past week, according to employees. Best, Don Bauder

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dwbat Nov. 7, 2011 @ 10:32 p.m.

Maybe Manchester would use the U-T property to trade it to the Navy for more of their land? ;-)

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Don Bauder Nov. 7, 2011 @ 10:49 p.m.

And what would the Navy do with it? For decades, the Copley papers were written and edited for the benefit of the Navy. I guess it's fitting that the Navy now own the property or the newspaper itself. Best, Don Bauder

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Burwell Nov. 7, 2011 @ 11 p.m.

Papa Doug has a lot on his plate. He's about to break ground on a 1,000 room highrise hotel at the San Antonio convention center in Texas. At some point he is going to have to start work on the Naval complex redevelopment. I don't see how he will be able to handle both projects at the same time. He is over 70 years old. Given the projects he has in development and his age, there is no chance he would want to own a newspaper. No rational man in his situation would buy the U-T. He certainly might buy the land though as an investment, or for his heirs.

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Don Bauder Nov. 8, 2011 @ 6:54 a.m.

Good points. Also, Manchester historically has not cooperated with the press -- in fact, has appeared to be downright contemptuous of reporters asking questions. Manchester hints that he might be part of a deal involving other parties. Whether any of those other parties would want to continue the print editions is problematic. Trouble is, online editions are not profitable for newspapers around the country. Print editions may be unprofitable or barely break even. The days of fat returns are over. Best, Don Bauder

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alfredpope Nov. 8, 2011 @ 2:24 a.m.

This comment was removed by the site staff for violation of the usage agreement.

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WhatGoesAround Nov. 8, 2011 @ 9:28 a.m.

Does anyone know how many satellite ofices remain of the U-T's distributed advertising team infrastructure? I speculate a distributed network of offices throughout SD County could serve as the basis for a vital online-only operation, with Chula Vista as the online operations hub anchoring the south end of the county, and an executive HQ at Platinum's offices in Beverly Hills. I deeply value printing as a cultural cornerstone, so I hope a U-T printed product survives regardless.

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Don Bauder Nov. 8, 2011 @ 10:25 a.m.

I believe that some news and ad sales offices have been closed, but I couldn't give you particulars. Best, Don Bauder

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GHJohn Nov. 8, 2011 @ 2:51 p.m.

Manchester, fraternity brother of longtime Pete Wilson Chief of Staff Bob White, has reasons beyond newspaper profitability of the UT to purchase. Particularly with the death of Herb Klein and the sale to an out-of-town party, the people controlling the city have had less sureness about controlling the narrative in the way only the UT can do in San Diego. The UT's capacity to frame the debate on the massive public giveaways (Chargers stadium, Convention Center expansion, giveaway of public tidelands, etc) is worth more than the purchase price of the paper. Also owning the UT is a very economical way to help their owned political candidates elected. Would anticipate if Manchester buys the UT he does through a Delaware LLC so he, like all good developers here do, be the person who takes the heat of ownership while those who really control things can share ownership and profits without being revealed.

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Don Bauder Nov. 8, 2011 @ 4:31 p.m.

Around three years ago, when the Copley crew was looking for a buyer, I feared that local establishment nabobs would buy the paper to make sure that corporate welfare propaganda kept spewing from the paper. But it has continued to spew under Platinum Equity. Since the paper is moderately profitable at best, and possibly losing money by legitimate accounting standards, it would take a number of nabobs to keep the puff mill going. Nobody likes to make an investment in a loser. Or, Platinum, which bought it cheap, could sell it even cheaper. Best, Don Bauder

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Twister Nov. 8, 2011 @ 3:50 p.m.

I dealt with this bunch many moons ago, and I was never so happy to be cheated early in the game so I didn't get taken for everything later (defines success for a lot of small businesspeople in Scam Diego). Suckin' 'em up and spittin' 'em out is de rigueur around here, but this outfit's got a lot on a lot, and has been in action so long it can call in all kinds of "obligations" just about any time for all time . . .

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Don Bauder Nov. 8, 2011 @ 4:33 p.m.

At least you got cheated and learned a lesson, backing out. Best, Don Bauder

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Burwell Nov. 8, 2011 @ 7:21 p.m.

I don't know anything about Twitter or Tweets. If Rachel Laing's Tweets are date and time stamped, then somebody should set up an Excel Spreadsheet and enter in the date and time of all her Tweets to see if she is Tweeting on the government dime. The Tweet relating to Bauder's Manchester blog has nothing to do with City business. City employees should not be searching the internet or reading blogs on city time.

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Don Bauder Nov. 8, 2011 @ 7:36 p.m.

Today Laing came back with a couple of defensive tweets in response to my mention of her in the Manchester post. She said, "Just because it turned out to be true does not excuse reporting an unsubstantiated rumor." She said that not knowing how substantive the rumor was on Sept. 29, and how credible the source was. She also tweeted, "Mention of me was totally gratuitous. And being gratuitously mentioned in the Reader means you're 'somebody.'" OK, Rachel, you are "somebody." Thanks to Matt Potter for sending along her followup tweets. Best, Don Bauder

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Burwell Nov. 8, 2011 @ 7:25 p.m.

Particularly with the death of Herb Klein....

Herb is not dead. I saw him at the CalNeva Lodge playing Blackjack last month.

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Don Bauder Nov. 8, 2011 @ 7:38 p.m.

Herb Klein was obsessed with sports and worshipped athletes. Since pro sports and the gambling industry are so closely linked, I am not surprised that he showed up at the blackjack tables. Best, Don Bauder

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Don Bauder Nov. 8, 2011 @ 8:01 p.m.

JOHN LYNCH PARTNERING WITH MANCHESTER. John Lynch, a longtime radio investor and executive, is a partner of Doug Manchester in the possible purchase of the Union-Tribune, according to Voiceofsandiego.org. The two have been partners in other ventures. Michael McKinnon Sr., who controls KUSI-TV, has also put in a bid, says the Voice. McKinnon was interested in buying the U-T even before it went on the market in mid-2008, but was snubbed by Evercore Partners, the Wall Street firm that was hired by Copley Newspapers to sell the U-T, and recently was hired by Platinum Equity, current owner, to look into the paper's future. (Information in that last sentence came from the Reader, and not the Voice.) Best, Don Bauder

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BradleyFikes Nov. 9, 2011 @ 9:10 a.m.

What Don did was okay, because he clearly labeled this as a rumor, and did not present it as fact.

What I think is poor journalism is to report something from anonymous sources as factual. Many newspapers do this, including the Union-Tribune:

http://www.signonsandiego.com/news/2011/jun/07/sources-identify-usd-player-who-declined-bribe/

"One key question that has lingered since USD game-fixing charges were leveled against 10 defendants in mid-April: Who was the player allegedly solicited by Brandon Johnson “to affect the outcome of USD basketball games for monetary bribes?”

"That player, the Union-Tribune has learned, is forward Ken Rancifer.

"Rancifer, according to multiple sources with direct knowledge of the case, was offered a monetary bribe during the meeting but declined to participate. He was not indicted, and there are no indications he will be."

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Don Bauder Nov. 9, 2011 @ 1:01 p.m.

In publishing stories about Manchester's possible interest in the U-T, and Hedgecock's possible move from KOGO to KFMB -- both of which turned out to be true -- I very carefully stated that they were rumors. Both were from excellent sources. I agree with you: it's OK to publish rumors if they are plausible and from credible sources, as long as you mark them as rumors. Best, Don Bauder

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