Hollinger Buys Chicago Sun-Times p. 15

By: Mark Fitzgerald Conrad Black's Canada-based international newspaper
company acquires the paper for $180 million in cash sp.

CONRAD BLACK'S HOLLINGER Inc. will buy the Chicago Sun-Times for $180 million in cash.
In a surprise announcement Feb. 28, officials of American Publishing Co., Hollinger's U.S. newspaper division, and current Sun-Times management and owners said the deal had been informally discussed for two or three years.
Serious discussions began in November, said F. David Radler, chairman of American Publishing and president and chief operating officer of Vancouver, British Columbia-based Hollinger.
For Black, a feisty Canadian conservative, the Sun-Times purchase gives him the kind of high-profile U.S. newspaper property that eluded him when Mortimer Zuckerman edged him out for ownership of the New York Daily News.
Black's sprawling empire includes several impressive newspapers on different continents, including the London Daily Telegraph; Sydney (Australia) Morning Herald; Financial Post, Canada's national financial daily; and Jerusalem Post.
Since its creation in 1986, American Publishing has bought papers through good times and bad.
However, its 97 papers mostly are small-town monopolies, typified by such flags as the Olney (Ill.) Daily Mail, Augusta (Kan.) Daily Gazette and Beatrice (Neb.) Daily Sun.
With the purchase of the 535,793-circulation Sun-Times, American Publishing will just about double its current combined daily circulation of 540,000.
Black is a publisher with outspoken conservative views that he articulates forcefully on relatively rare occasions.
In a memorable 1988 speech at the annual meeting of Canadian Press, for example, Black ridiculed a wide range of attitudes dearly held by many working journalists.
He said this, for example, about the idea that libel laws "chill" free expression: "The working press, through some of the most influential media outlets in [Canada], is now claiming impunity for its own lapses of self-control, and in evoking this self-pitying scam of libel chill is seeking to create a right that would enthrone the media as the absolute arbiters and creators of public opinion, liberated from the disciplines and countervailing forces that all the rest of us must respond to."
Hollinger and Sun-Times officials, however, were quick to say Black will maintain the newspaper's editorial independence.
"This newspaper will be directed by the people who work at this paper, not from my office in Vancouver," Radler said.
Indeed, the management will not change when the sale becomes effective, probably March 31, said Radler, who will become chairman of Sun-Times.
Sam McKeel will remain president and CEO of Sun-Times and publisher of the newspaper.
Dennis Britton will remain editor and executive vice president of the Sun-Times.
Michael Veitch will stay on as the newspaper's general manager and executive vice president.
The sale includes Sun-Times' two suburban Chicago weekly newspaper chains, Pioneer Press and Star Newspapers.
The chains have a combined circulation of about 240,000.
McKeel said the Sun-Times newsstand price of 35? ? 15? lower than the newsstand price of rival Chicago Tribune ? will not change as a result of the purchase by Hollinger.
The biggest change, McKeel said, is that Hollinger will be able to provide greater financial resources than the paper's current owner, the New York investment firm Adler & Shaykin.
McKeel specifically mentioned the possibility of replacing the Sun-Times' ancient Goss letterpress Headliner presses.
McKeel said the Sun-Times is profitable now.
The Hollinger transaction marks the fourth time in a decade that the 53-year-old newspaper has been sold.
In 1984, the squabbling longtime owners, the Field family, sold the paper and its valuable News America Syndicate to Rupert Murdoch for about $100 million. The arrival of the Australian native, and his Fleet Street-trained editors, caused a remarkable uproar in the city and drove many journalists ? including the city's best-known columnist, Mike Royko ? to abandon the tabloid.
In 1986, Murdoch sold the paper for $145 million to a group whose major investor was Adler & Shaykin but whose most visible member was then-publisher Robert Page.
A year later, Page sold his minority interest to Adler & Shaykin, whose principal, Leonard Shaykin, is chairman of Sun-Times.
Radler said the $180 million price tag, which some analysts suggested was high for the Chicago market's second paper, was "a profitable transaction" for Hollinger.
The Sun-Times' circulation of 535,793, according to the latest Audit Bureau of Circulations FAS-FAX report, makes it the 11th-largest paper in the country.
Its sales compare with the Tribune's daily circulation of 690,842.
The Sun-Times' Sunday circulation has recently slipped below its daily total and was 524,475 in the last reporting period.
The Sunday Tribune sells 1,101,863 copies.


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