How and why the leadership changed p.

By: M.L. Stein

WHEN HE DIED in 1925, Michel de Young, founder of the San Francisco Chronicle, was survived by four daughters. His only son died in 1913 at the age of 32.
Before his death, de Young had arranged for his son-in-law George Cameron to run the papers and for his daughters, all married, to have comfortable incomes for the rest of their lives.
"He wanted them to have enough spending money, not big money but enough to be independent of their husbands," said de Young's granddaughter Nan Tucker McEvoy.
As a teen-ager, de Young launched the Chronicle with his brother, Char-les, as a free theater program sheet in the rough-and-tumble San Francisco of 1865. He probably never dreamed that it would develop into a multimillion-dollar media empire or that McEvoy would wind up as the major shareholder and chairman of the board of the Chronicle Publishing Co.
The company now includes the 544,253-circulation Chronicle, two other newspapers, three television stations, a big cable operation, a book-publishing firm and other interests.
Nor could de Young (his brother was shot to death by a political enemy in 1880) foresee that in 1993, 20 of his descendants would be shareholders in the company and that they would vote to bring in outside management in what always had been a family-operated business.
One of de Young's daughters, Patricia de Young Tobin, had no children. Current shareholders are offspring of the other three daughters.
"What happened was that the family started to meet with each other and decided the company had grown so much that it was probably time for an outside manager to come in," said McEvoy, 74. Her mother was Phyllis de Young Tucker, the youngest of de Young's daughters and the company's principal stockholder when she died in 1988.
At that time, the company's assets were shifted from a family trust and distributed as shares to family members.
In recent years, the family decided that new blood could reverse the Chronicle's revenue slide and trim the company's overhead bloat, McEvoy said.
The "outsider" was John Sias, 66, a former executive vice president of Capital Cities/ABC Inc., who has a reputation as a quirky but tough executive with a shrewd eye for cost-cutting.
His entrance led to the forced exit of Richard Thieriot as editor and publisher of the Chronicle, although his name remains on the masthead, and three other family members: Charles (Kip) Thieriot, Richard's brother, as president of Westcom, Chronicle Publishing's $70 million cable company; Francis (Rannie) Martin, as head of the company's TV stations; and Peter Thieriot, as chairman of the company's newspapers in Worcester, Mass., and Bloomington, Ill. The publishers of those newspapers now report directly to Sias.
McEvoy, a widow, denied reports that there had been what she termed a "sudden explosion" or a bitter family squabble about the company's new course.
"The discussion was reasonable, not rancorous," she explained. She said the board first consulted the San Francisco banking firm of Hellman and Friedman on a course of action.
"They did something unusual. They interviewed every family member," McEvoy said. "Everyone said they were very fond of Dick Thieriot, but most thought we ought to change to non-family management. It had nothing to do with dividends or spite."
McEvoy acknowledged reports that some family members wanted to sell shares.
"When you have a family as large as this, there is always a small percentage of them who would sell a few shares so they could buy something they always wanted," she observed.
"But I believe there are very few who want to get out entirely ? possibly two or three."
McEvoy praised Richard Thieriot for making a "substantial contribution" to the paper during his 16 years at the helm and added that the other Thieriot managers left their domains in good shape.
"But the de Young family is lucky indeed to get John Sias, a professional of high esteem," she added.
McEvoy, who has sworn that the Chronicle will not be sold, said she does not believe that the newspaper will prosper until the end of its joint operating agreement with the San Francisco Examiner and its parent, the Hearst Corp.
The agreement is scheduled to end in 2005 but could end sooner if one party buys out the other.
Richard Thieriot said he bore no resentment about his ouster, saying, "This kind of thing happens a lot in a family business."
In fact, he added, he approved the hiring of Sias as the best move that could be made in light of family differences about the direction that the company should take.
"I should have thought of the same thing years ago," he commented.
At the same time, however, he noted that during his period as Chronicle Publishing president, the company went from a $200 million firm to one valued at more than $1 billion and Chronicle circulation increased from 460,000 in 1975 to a high of 575,000 in 1990.
Circulation now stands at 544,053, according to the Audit Bureau of Circulations' latest FAS-FAX report.
"Average returns to shareholders were 14% to 15%, which compared very favorably to other major newspaper companies," he said. "If not for the JOA, returns would have been even higher."
Thieriot, who received about $1.5 million in a severance package, recently became chairman of Parrott Investment Co., another Chronicle Publishing enterprise.
Charles Thieriot declined to comment on the company changes.
Peter Thieriot did not respond to a phone call, and Martin was out of the country.