Chicago Sun-Times Given to Charity as Owner Turns to Tribuneby
Michael Ferro became Tribune's largest shareholder last month
Tribune executive Denise Warren also leaves company in shakeup
Michael W Ferro Jr., the entrepreneur who became Tribune Publishing Co.’s largest shareholder in February, has donated his stake in rival newspaper Chicago Sun-Times to a charitable trust.
Ferro, founder and chief executive officer at Merrick Ventures, acquired a 17 percent stake in Tribune Publishing last month, becoming its non-executive chairman with a $44.4 million investment. Ferro had created Wrapports LLC, a media holding company, in December 2011 to make his investment in the Chicago Sun-Times.
“This divestiture will create a very clear separation of ownership and avoid perceived conflicts of interest, while also providing millions of dollars for community programs and other charitable causes,” Chief Financial Officer Sandra Martin said in a statement Wednesday announcing a number of management changes. Ferro’s ownership of the Sun-Times and Wrapports will be included in the trust, she said.
Denise Warren, who was hired less than a year ago to lead Tribune’s digital operations, is leaving the company. Warren, a former New York Times Co. executive who helped create the Times’ digital subscription model, “has decided not to relocate,” Tribune said in the statement. Under Warren, Tribune’s digital traffic has grown, the company said, and its flagship paper, the Chicago Tribune, introduced a new metered pay model last month that gives reader access to up to 10 articles each month before being asked to subscribe.
Tribune, also the owner of the Los Angeles Times and Baltimore Sun, among other newspapers, promoted Tim Ryan president of publishing. Last fall, Ryan was named publisher and chief executive of the California News Group, which includes the Los Angeles Times and the San Diego Union-Tribune. He will report to newly installed CEO Justin Dearborn, who was given the role after the company ousted Jack Griffin last month.
In addition to shaking up its management, Tribune said it will offer free digital access to all print subscribers across every Tribune Publishing property by April and that it has acquired LA.com to start a new channel “to celebrate Los Angeles and extend the reach of the Los Angeles Times brand.”
The shares rose as much as 16 percent to $9.86 in New York, and were trading at $9.71 at 9:55 a.m., their highest price since Dec. 30. The stock has climbed 20 percent since Ferro became Tribune’s largest shareholder.
It has been a tumultuous year for the company. In September, Tribune fired Los Angeles Times Publisher Austin Beutner after little more than a year on the job, replacing him with Ryan, an executive from the Baltimore Sun.
Last summer, Eli Broad, a Los Angeles billionaire, made an overture to buy the newspaper and the San Diego Union-Tribune, according to a person with knowledge of the matter. Broad and Beutner had previously teamed up in a bid to buy the Times.
Tribune reported fourth-quarter earnings excluding some items of $1.34 a share, beating analysts’ estimates of 87 cents. Operating revenue was $461.8 million, compared with estimates of $464.3 million, the company said.
Ad sales declined 1.9 percent to $268 million in the fourth quarter, while circulation revenue grew 10.1 percent to $122 million compared with a year earlier. The publisher said it expects continued pressure on both advertising and circulation in 2016.
Tribune’s newspaper unit was spun off 2014 from its TV business, now called Tribune Media Co.