The newspaper chain led by software entrepreneur Michael Ferro bought the New York Daily News tabloid, adding the nation’s largest media market to a group of dailies that includes the Los Angeles Times, Chicago Tribune and Baltimore Sun.
Tronc Inc. agreed to pay $1 and assume operational and pension liabilities for the newspaper in a deal that includes 100 percent ownership of a printing facility in New Jersey, the Chicago-based group said in a statement. The pensions and liabilities Tronc is taking over total more than $100 million, according to people familiar with the transaction, who asked not to be identified because financial terms are confidential.
Acquisition of the almost 100-year-old paper marks the highest-profile media deal for Ferro, who bought into Tronc last year through his Merrick Ventures LLC and told interviewers he wanted to save journalism. The New York Daily News, which has garnered 11 Pulitzer prizes including one this year for public service journalism, “helped shape the dynamics of the city,” Mortimer Zuckerman, owner and publisher since 1993, said in the statement.
Tronc and rivals including Hearst Corp. and Gannett Co. are buying more papers to gain economies of scale as a decline in print advertising and relatively small gains in digital ad growth cut valuations for magazine and newspaper brands. Last year in the U.S., 50 daily newspapers changed hands in 28 deals, according to newspaper merger-and-acquisition firm Dirks, Van Essen & Murray. The deals were driven largely by families or small newspaper groups getting out of the business.
Arthur Browne, the newspaper’s editor-in-chief, will remain in that role and has also been named publisher, according to the statement. He will report to Tronc President Timothy Knight. The newspaper group will now operate in 10 major U.S. markets and have more than 80 million unique monthly digital visitors.
The Daily News, which has long held a tabloid rivalry with the New York Post, has gained attention over the past year with provocative covers critical of Donald Trump.
The deal comes as Tronc’s largest newspaper, the L.A. Times, undergoes a management shakeup after ousting four top editors last month.
By acquiring the Daily News, Tronc owns newspapers in New York and Los Angeles, the top two media markets, potentially creating larger national advertising opportunities. Tronc now also owns more newspapers in the Northeast, including the Hartford Courant in Connecticut and the Morning Call in Allentown, Pennsylvania, which may help save on printing costs.
Tronc’s proposal to buy cross-town rival Chicago Sun-Times owner Wrapports LLC, where Ferro formerly owned a stake, was rejected by regulators on concern it would be bad for competition. Tronc, formerly known as Tribune Publishing Co., paid $56 million last year for Freedom Communications Inc., publisher of the Orange County Register in California.
Methuselah Advisors advised New York Daily News owner, Daily News L.P., on the transaction, according to the statement.