"Papa" Douglas Manchester's rowdy reign as the big-money Republican owner of the U-T San Diego has come to the end with the closing of his $83 million deal to sell the newspaper and its smaller satellites to Tribune Publishing of Chicago.
Tribune made the announcement in a May 21 disclosure statement filed with the Securities and Exchange Commission.
Citibank "provided a $70,000,000 increase to the term loan under the Company’s existing senior term loan facility" to finance the purchase of Manchester's MLIM holding company.
"The total purchase price for the Acquisition consisted of $71 million in cash after application of the estimated working capital adjustment, and $12 million in common stock of the Company, or 700,869 shares," according to the disclosure.
"In addition, MLIM, which will become a subsidiary of the Company, will also retain certain liabilities, including its existing pension obligations."
On Monday, May 18, Tribune Publishing’s chief executive officer Jack Griffin told a media and telecom conference put on by J.P. Morgan Global Technology that the company, which also owns the Los Angeles Times, would move swiftly to consolidate its hold on the San Diego paper.
"The L.A. Times is just about 100 miles up the road on the 5 or the 405. You can get a truck full of newspapers at three o'clock in the morning down to San Diego in a little over an hour," said Griffin, adding, "It doesn't snow there, which is a big help."
He continued, "And so, within three months after the acquisition closes we will exit the printing facility in San Diego, and the printing of that newspaper and all its derivative products will be done out of our Olympic plant in Los Angeles, which is one of the biggest printing plants in North America with capacity."
Another "big piece of the cost synergy," said Griffin, "is the distribution, so there's plenty of L.A. Times newspapers that already get distributed in San Diego County so we have efficiencies that we create there."
Political coverage is also likely to change, based on what Griffin had to say.
"A paper like San Diego on its own doesn't have access to a Washington bureau like we have for political coverage, so there's a lot we can do with the product and we love markets like San Diego that have macro economic tailwinds and great franchises."
The abrupt shift from Manchester's Koch brothers–tied Republican ownership to U-T’s new publisher Austin Beutner, a former associate of Democrats Bill Clinton and ex–L.A. mayor Antonio Villaraigosa — as well as a major donor to president Barack Obama — has some local members of the GOP concerned the city could lose more than just printing jobs.
Others fear that under new ownership the paper could become a stealth player in efforts to move the Chargers to L.A.
The first management change by the new ownership was announced by Beutner in a statement posted on the U-T website.
"Russ Newton, The Times’ Senior Vice President for Operations, will join the team in San Diego as President and Chief Operating Officer of The San Diego Union-Tribune. He will help lead the Union-Tribune team, working with Editor Jeff Light, Managing Editor Lora Cicalo and Bill Osborne, Editorial and Opinion Director."
Beutner, who signed the statement "Austin," confirmed the newspaper’s name has reverted to San Diego Union-Tribune from Manchester's favored U-T San Diego.