Chicago Investors Buy 'La Raza'

By: Mark Fitzgerald In the latest development in Chicago's competitive Spanish-language newspaper market, a Hispanic-owned venture capital fund bought a controlling stake in Chicago's biggest Spanish-language weekly, La Raza, just days after the Chicago Tribune relaunched its 10-year-old free weekly Exito as a paid daily called Hoy.

Chicago-based Hispania Capital Partners paid about $5 million for a majority interest in La Raza publisher Rossi Publications Inc., which was renamed PrensAmerica Corp., said fund partner Carlos L. Signoret. Luis Rossi, the Uruguayan who owned La Raza for 21 years, will retain a stake in the new company.

With its Sept. 14 issue, the mostly free-distribution weekly -- which calls itself the nation's largest Spanish-language Sunday paper -- is increasing its press run from 150,000 to more than 190,000 copies. The additional copies will go to free home delivery to Hispanic households in Waukegan, Elgin, Aurora, and other Chicago suburbs with rapid increases in Latino population. Hoy, which now circulates Monday through Friday, has had initial press runs of about 60,000 copies.

With the expansion will come the first editorial and advertising zoning of La Raza, said Robert J. Armband, the paper's longtime associate publisher under Rossi who was named PrensAmerica's CEO and publisher. "Each area has its own editor, sales staff, and distribution team," Armband said of the four zones. "Starting this Sunday [Sept. 14], with our home distribution on top of our paid base, we will be achieving our goal of reaching 50% of Hispanic households in the Chicago market."

PrensAmerica will expand the La Raza brand name locally by increasing distribution of its Yellow Pages product, La Raza Paginas Amarillas, and launching other products such as real estate and auto books, Signoret said. The fund is also shopping for other opportunities outside the Chicago area, he added: "I don't want to say national, because that is quite a gulp, but we want to follow the concentrations of Hispanic populations. Texas is important to us, California is important."

The Tribune's introduction of Hoy has not changed the competitive dynamics, Signoret said. After 10 years, La Raza is used to competing with the Tribune. "We happen to have a very good product with great brand recognition and a great distribution system," he said.

Publisher Armband suggested the Sunday La Raza will benefit from Hoy, which circulates Monday through Friday and has had initial press runs of about 60,000 copies: "When advertisers see the Tribune is involved in this, it enhances the credibility of Hispanic print."

And besides, Signoret said: "Every major market has more than one (Spanish-language) product. Chicago is a big market and it's growing; there's plenty of room for us and Hoy."

Is PrensAmerica giving any thought to taking La Raza daily? "Not immediately," Signoret said. "We just have a lot going on right now."