Dr. Patrick Soon-Shiong, the Los Angeles health care billionaire, has apparently shifted sides and is now backing the bid by McClatchy Co. to take over Tronc, owner of the Chicago Tribune, the Baltimore Sun and the struggling Daily News.
The good doctor had originally backed a bid by hedgie Will Wyatt’s Donerail Group to take over Tronc — but a rift developed between the two in recent weeks, sources said.
If a deal with McClatchy comes to fruition, then Soon-Shiong could potentially end up as chairman of a combined Tronc/McClatchy.
Soon-Shiong, of course, in June bought the Los Angeles Times and the San Diego Union Tribune from Tronc for $500 million. He remains the second-biggest shareholder in Tronc — with about a 25 percent stake, so has a lot to say when it comes to who gets to take over.
Former Tronc chairman Michael Ferro, who owns a touch more of the stock — roughly 26 percent — wants a $19- to $20-a-share price. It was Ferro who recruited Soon-Shiong to invest in Tronc, the former Tribune Co., back when Ferro was trying to fight off Gannett’s unsolicited bid.
The two had a falling out once the danger passed.
Wyatt’s bid is said to be around the $19-to-$20 range. It is not a sure thing that McClatchy can raise the funds.
Sacramento, Calif.-based McClatchy has a much smaller market capitalization, at $65.47 million, compared to Tronc’s $588.29 million — plus it is carrying a heavy debt load.
One of McClatchy’s largest shareholders happens to be Chatham Asset Management — the same company that owns 80 percent of American Media Inc., the scandal-scarred parent of the National Enquirer.
McClatchy’s biggest papers are the Miami Herald and the Kansas City Star, but it also owns its hometown Sacramento Bee and nearby Modesto Bee. They would be attractive additions to Soon-Shiong’s other California holdings. A spokeswoman for McClatchy said, “We don’t comment on rumors.” Tronc, Donerail and a spokeswoman for Soon-Shiong all declined comment.