Dear Colleagues,
I am pleased to share with you three important announcements:
First, tronc, Inc. has entered into a definitive agreement to sell the Los Angeles Times, The San Diego Union-Tribune and various titles in the California News Group (the “Portfolio”) to Nant Capital, LLC, a private investment vehicle of California-based entrepreneur Dr. Patrick Soon-Shiong, for $500 million in cash plus the assumption of $90 million in pension liabilities. The transaction will close following the receipt of customary governmental approvals, which we expect to occur in March or April.
We are pleased to transition leadership of the Los Angeles Times and The San Diego Union-Tribune to local ownership and are certain that the legacy of journalistic excellence in Southern California will continue long into the future.
This transaction will allow us to fully repay our outstanding debt, significantly lower our existing pension liabilities, and have a substantial cash position following the close of the transaction. We will have a versatile balance sheet that will enable us to be even more aggressive in executing on our growth strategy as a leading player in news and digital media. We have a pipeline of robust opportunities, and M&A will continue to be a significant part of our future.
Jim Kirk will continue as Editor-in-Chief of the Los Angeles Times, Jeff Light will continue as Publisher and Editor-in-Chief of The San Diego Union-Tribune, and Chris Argenetari will resume his role as General Manager of the California News Group. Each will report to Tim Knight through the closing of the transaction. Chris will lead the transition planning process working with the buyer.
Second, the Company has acquired a majority ownership stake in BestReviews, the fast-growing online product review company based in San Francisco, California and Reno, Nevada.
Founded in 2014, BestReviews’ mission is to simplify the way consumers buy the products and services they need across thousands of categories from laptops to vacuum cleaners to rowing machines. All products on BestReviews’ site are thoroughly and independently researched. The Company buys all of its products and tests them in its own labs to help ensure that consumers find the best, most affordable products on the market. The Company attracts more than 5 million unique monthly visitors and has helped more than 170 million consumers make more informed purchases since its inception.
BestReviews’ dedication to independent and high-quality content aligns with our ongoing mission to provide valuable information and experiences for our readers. We look forward to combining BestReviews deep product research and fully optimized commerce engine with tronc's digital properties, a combination which we believe will strengthen our e-commerce efforts.
Finally, with the cash infusion from the sale of the California News Group and our strong balance sheet, we will be even more aggressive in executing on our digital growth strategy. Today, we are launching the newly reorganized Tribune Interactive division to enhance our digital assets and pursue strategic growth investments like BestReviews.
Tribune Interactive (TI) will be the home to tronc’s digital assets including product development and engineering; digital subscriptions and marketing; and the studios unit which includes video, audio and new content formats. TI will also include the Company’s syndication unit TCA, recent digital acquisition The Daily Meal, national digital sales and digital corporate and business development. TI will launch, partner with, invest in and acquire digital businesses to accelerate the growth of new digital revenue streams. The division will continue to develop and distribute national digital content to each of the brands within tronc, as well as across affiliated web and mobile properties, partners and social platforms. TI will work with all of our local markets to ensure we have the best digital offerings available.
TI will be led by newly reinstated executive Ross Levinsohn, who will assume the post of CEO of the national effort. Mickie Rosen will serve as President; Lewis D'Vorkin will serve as Chief Content Officer; joining Ben Gerst, Chief Technology Officer; Mark Campbell, Senior Vice President of Digital Marketing and Rob Angel, Chief Business Development Offices. Following an independent investigation and a report to the Board of Directors finding no wrongdoing on the part of Mr. Levinsohn, Ross was reinstated and appointed Chief Executive Officer of Tribune Interactive, LLC. Tribune Interactive will be based in Chicago, with offices in New York and Los Angeles. Ross and his team will report to me.
We are excited to continue to build the future of tronc through innovative products and leading digital content and distribution initiatives, as well as through strategic partnerships and acquisitions to accelerate growth. We are pleased that Ross will be back to work and have great confidence in him and his team to exponentially grow our audience and revenues to deliver value to shareholders and readers.
I hope each of you is as excited as I am about the future of the Company and how we can continue to accelerate our digital growth and transformation. There is much work to do, and we look forward to sharing more of our plans over the next few weeks.
Finally, I want to express my sincere appreciation to each of our colleagues at the Los Angeles Times, San Diego Union-Tribune and the rest of the California News Group for their many contributions to the Company and wish each of them all the best as we transition ownership.
Best regards,
Justin Dearborn
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