(MENAFN - AFP)Billionaire physician and investor Patrick Soon-Shiong agreed Wednesday to buy the Los Angeles Times, in a move aimed at reviving the fortunes of the newspaper amid recent turmoil.
Publishing group Tronc Inc. said it reached a deal to sell the LA Times and San Diego Union-Tribune to Soon-Shiong's Nant Capital for $500 million plus the assumption of $90 million in pension liabilities.
The move comes after months of newsroom unrest at the storied Los Angeles daily that has seen three editors in the past six months, and a vote to unionize the journalists.
"We are pleased to transition leadership of the Los Angeles Times and The San Diego Union-Tribune to local ownership, and we are certain that the journalistic excellence in Southern California will continue long into the future," said Justin Dearborn, chief executive of Tronc, the name adopted for the group previously known as Tribune Publishing.
Soon-Shiong, a surgeon whose biotech investments have boosted his net worth to some $7.8 billion, said in a statement: "We look forward to continuing the great tradition of award-winning journalism carried out by the reporters and editors of the Los Angeles Times, The San Diego Union-Tribune and the other California News Group titles."
The LA Times, like many newspapers, has been downsizing its staff as readers turn away from print to online news platforms.
The Los Angeles daily was family-owned for more than a century before being sold to the Chicago-based Tribune Co. in 2000.
Tribune Co., which split off its broadcast division and renamed its publishing arm Tronc (for Tribune Online Content), will continue to own the Chicago Tribune, Orlando Sentinel, South Florida Sun-Sentinel, Baltimore Sun and the New York Daily News.
The LA Times Guild, which recently won the right to represent employees, welcomed the news, saying it "looks forward to working with a local owner who can help us preserve The Times as a guardian of our community and as the voice of the American West."
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Soon-Shiong, born in South Africa to Chinese parents, has been an investor in Tronc and also owns a stake in the Los Angeles Lakers basketball team. He has been a faculty member at the UCLA medical school and has invested in and donated to medical research.
He was a founder of the Cancer MoonShot 2020 program, renamed Cancer Breakthroughs, aimed at developing immunotherapies to cure cancer.
Soon-Shiong is the latest billionaire to seek to turn around struggling newspapers, following on the heels of Amazon owner Jeff Bezos's purchase of the Washington Post and Boston Red Sox owner John Henry's deal for the Boston Globe.
"I'd say this is good news, but with a caveat," said Dan Kennedy, a Northeastern University journalism professor and author of a forthcoming book on the efforts of Bezos and Henry to remake American newspapers.
"Wealthy local ownership is exactly what the Los Angeles Times and the San Diego Union-Tribune need, assuming that Dr. Soon-Shiong is willing to be patient and to respect the independence of the newsroom."
Kennedy noted that the businessman has in the past criticized "false reporting" about his own research efforts.
"Given that, we'll have to see which Dr. Soon-Shiong shows up in the owner's suite," Kennedy said.
Separately, Tronc announced a new digital strategy, and appointed recently reinstated executive Ross Levinsohn to head a new Tribune Interactive division.
Levinsohn, a former interim CEO at Yahoo who has worked in other online services, returns from leave after an independent probe into allegations of sexual harassment which found no wrongdoing, according to Tronc.
New York University journalism professor Jay Rosen said the new digital strategy appears at odds with the plan to shed the Los Angeles Times.
"If there was any discernible plan at @tronc it depended on the idea of scale," Rosen tweeted. "Selling @latimes means that idea has gone bust."