The owner of the Los Angeles Times is in talks to sell the paper to a local biotech billionaire, the latest twist in a chaotic few months for the nation’s largest metro newspaper, sources familiar with the matter told CNNMoney.
Michael Ferro, who controls the paper’s parent company Tronc, is negotiating with Patrick Soon-Shiong, a Tronc investor and physician who has been dubbed “the world’s richest doctor.”
The deal, if reached, could see Soon-Shiong buying both the Los Angeles Times and the San Diego Union-Tribune for roughly $500 million plus pension liabilities, according to one source with knowledge of the matter.
The $500 million price tag would put the two papers at twice the price of the Washington Post when Amazon founder Jeff Bezos bought it in 2013 — a valuation that is likely to mystify industry observers.
News of a possible deal was first reported by the Washington Post. NPR and the Los Angeles Times itself have also reported on the talks.
Representatives for Ferro and Soon-Shiong were not immediately available for comment.
The talks come on the heels of a tumultuous period at the Times, including the appointment of three editors-in-chief in less than six months and the suspension of a publisher over prior sexual harassment allegations.
Times staffers have been widely critical of Ferro’s tenure at the top of Tronc, sources at and close to the paper have told CNNMoney. But early conversations with employees suggest that they feel Soon-Shiong may only be a minor improvement.
“He’s not Ferro, he’s also not Jeff Bezos,” one of the sources familiar with the matter said.
Known as a savvy self-promoter, Soon-Shiong has drawn criticism from many in the healthcare community, as well as from investors. Shares of his biotech companies, NantHealth and NantKwest, have both fallen by more than 80% since he took them public. After looking into his “Cancer Moonshot 2020” plan to eradicate cancer, STAT News described it as “an elaborate marketing tool” for his businesses. (Through a spokeswoman, Soon-Shiong responded to that story in two statements, saying the initiative had made “remarkable progress.”)
Soon-Shiong first became an investor in Tronc in 2016 when Ferro was looking to shore up support to prevent Tronc — then Tribune Publishing — from selling itself to Gannett. But within a matter of months, Ferro and Soon-Shiong became locked in a bitter race to buy up shares and assume control of the paper.
In March 2017, Ferro increased his ownership stake to 30%. At the time, Soon-Shiong claimed that the board had allowed Ferro to raise his shares without letting him do the same. This made Ferro the company’s largest shareholder. Blindsided, Soon-Shiong accused the company of giving Ferro preferential treatment and asked to be allowed to increase his ownership stake as well, but was denied.
As recently as last week, sources with knowledge of the matter said Ferro was unlikely to sell the paper anytime soon. The recent tumult at the paper and the widespread opposition from the staff, which recently formed a union — the first in the paper’s history — may have changed his mind.