Billionaire Patrick Soon-Shiong partnering with McClatchy to buy Tronc

Patrick Soon-Shiong at an
NHS Confederation conference.

Flickr/NHS
Confederation

• Los Angeles Times owner Patrick Soon-Shiong is
  considering bidding for newspaper publisher Tronc, according to
  people familiar with the matter. 
• Soon-Shiong is considering a joint bid with newspaper
  publisher McClatchy. He had previously been in talks to team up
  with a hedge fund manager for Tronc, but those discussions are
  now seen as less likely. 
• Soon-Shiong spent $500 million in June to acquire the
  Los Angeles Times and The San Diego Union-Tribune along with a
  bunch of other community newspapers from Chicago-based
  Tronc.

Biotech billionaire and Los Angeles Times owner Patrick
Soon-Shiong, who had been in talks to team up with a hedge fund
manager for newspaper publisher Tronc, is now considering a
competing bid, according to people familiar with the matter.

Soon-Shiong is considering a joint bid with newspaper publisher
McClatchy, the people said, asking not to be named because the
matter is private. McClatchy is in “early stage” discussions to
buy Tronc,
the Chicago Tribune reported Friday.

Soon-Shiong, through his investment firm Nant Capital, had been
in talks to partner with Donerail Group, the private-equity firm
led by hedge-fund manager William Z. Wyatt,
which has been looking to acquire Tronc since early August.

But these talks, while not dead, are seen as less likely and
Soon-Shiong is now considering a bid with McClatchy. The people
cautioned that no bids are finalized and Soon-Shiong may choose
not to go ahead with a deal in the end. Soon-Shiong has also been
shopping for other partners, sources said.

A representative for Soon-Shiong could not be reached for
comment. Representatives for McClatchy and Donerail declined to
comment.

Soon-Shiong spent $500 million in June to acquire the Los Angeles
Times and The San Diego Union-Tribune along with a bunch of other
community newspapers from Chicago-based Tronc.

Soon-Shiong also remains Tronc’s second-largest shareholder, with
a nearly 25% stake. Michael Ferro, the Chicago entrepreneur who
was formerly Tronc’s chairman, is the largest shareholder, with a
nearly 26% stake.

Soon-Shiong has access to Tronc’s backend to manage the
California newspapers’ website operations for the next year, by
which time he must either set up a new structure or acquire it. A
partnership to acquire Tronc would enable Soon-Shiong to seize
control of those operations and implement a smoother transition.

A 66-year-old South African native and former UCLA surgeon,
Soon-Shiong amassed a fortune by building and subsequently
selling two biopharmaceutical companies. Since taking over the
Times, he has been on a mission to rebuild and revitalize the
newsroom, which has seen three editors in 10 months and five
publishers in four years.