The owner of the Chicago Tribune is looking to acquire the chief local rival of its flagship newspaper, with Monday’s announcement that Tronc is bidding for Wrapports Holdings, which publishes the Chicago Sun-Times. If the deal goes forward, it will bring the Sun-Times back under the control of Michael Ferro, the billionaire technology investor who previously owned Wrapports before taking over Tronc (then Tribune Publishing) in February 2016.
Late on Monday, Tronc revealed it has signed a letter of intent to acquire Wrapports, including the Sun-Times, as well as a number of other properties, like Aggrego, a digital content network that recent partnered with the Local Media Consortium, and the Chicago Reader, an alternative weekly.
Terms of the acquisition weren’t discloses.
The deal appears to be a number of months in the making, and both companies have worked with the Department of Justice’s antitrust division to smooth out any regulatory issues, according to the Chicago Tribune. In particular, to satisfy the DOJ’s antitrust concerns Wrapports has agreed to publish a full-page ad seeking another buyer, on the understanding the deal will be allowed to go forward if no other suitor comes forward.
The deal apparently reflects financial difficulties at the Sun-Times, which forced Wrapports to sell rather than close the newspaper.
Ferro previously relinquished his role as chairman of Wrapports and donated his shares in the Sun-Times to a charitable trust as part of the move to take over Tribune Publishing. His acquisition of a 17% stake in Tribune in February 2016 made him the largest stakeholder in the company.
He subsequently raised his stake in the renamed company to 25% by acquiring an addition 2.5 million shares in December 2016.
Tronc and the Sun-Times already work together in a number of areas: Tronc already prints and distributes its rival, and in 2014, acquired Wrapport’s network of Sun-Times' community newspapers.Tronc CEO Justin Dearborn reassured readers that the Chicago Sun-Times would retain its “independent voice” under new ownership, and both companies highlighted the benefits, including Chicago continuing to be one of the few big American cities with two daily newspapers.