Tribune Publishing CEO Jack Griffin is out after a shotgun corporate marriage that lasted fewer than three weeks.
It comes shortly after word that Michael Ferro, a Chicago tech executive who controls The Chicago Sun-Times, was being issued new stock to gain a 17 percent interest in the company and the chance to increase that to 25 percent within three years. Ferro was installed as non-executive chairman of the board amid typically upbeat corporate statements from Griffin about his arrival.
But Griffin’s tenure had been rocky since he took over a newspaper company spun off from the old Tribune Company’s more lucrative broadcasting arm, now called Tribune Media. Strategic gambits were slow to play out and its digital operations lagged behind those of many high-profile competitors. Wall Street was uneasy, and the stock continued to decline.
And now there was Ferro, whose ambitions to grab a piece of his hometown paper, The Chicago Tribune, have always been clear. With the second major coup of his career last fall — he took home personally about $240 million in a health care tech deal with IBM — he was positioned to consider a run at Tribune Publishing. He already had a deal with The Chicago Tribune under which Tribune prints the tabloid Sun-Times.
Industry analyst Ken Doctor confirmed what he tagged “a fast-moving turn of events, unusually quick by corporate standards,” and indicated the possibility that Ferro had overseen Griffin’s exit and directed the choice of a successor. Doctor says a likely choice could be Justin Dearborn, a longtime Ferro associate.
Tribune Publishing was expected to disclose the tumultuous news before the stock market opened Tuesday.
Earlier this month, Griffin heralded the arrival of Ferro, whose $44 million investment brought him the largest stake the firm, which owns 11 major daily newspapers. The biggest are the Los Angeles Times and the Tribune, but its holdings include the principal newspapers in Baltimore, Hartford, Orlando and Ft. Lauderdale.
There have been many rancorous ups and downs at Tribune since its 2000 purchase of Times Mirror in an $8 billion deal that, at the time, was generally heralded for consolidating major properties and potentially offering economies of scale. It did not turn out especially well. With the sharp industry downtown, a billionaire real estate investor bought the company but oversaw its slide into bankruptcy before he departed.
Relations between Chicago headquarters and Los Angeles were famously fraught, and that dynamic has changed little despite different ownerships. Last year, Tribune Publishing fired Austin Beutner, who was publisher of the Los Angeles Times, amid personal and strategic clashes. The rift included Beutner mulling the notion of a purchase of the paper backed by local billionaire philanthropist Eli Broad. Tribune Publishing, whose size would be significantly decreased if the Times were separated, rejected the notion.
As Doctor had previously noted, Ferro recently moved into an office at Tribune Tower in Chicago and soon asserted himself during treks to company operations in Los Angeles and New York with Dearborn.
Ferro’s newspaper background is brief and is traced largely to being on the board of a small nonprofit, the Chicago News Cooperative (of which I was a co-founder). Its primary focus was on what at the time an unprecedented partnership with The New York Times.
The CNC produced two pages of Chicago content each Friday and Sunday in a Midwest edition of the paper. It was judged enough of an early success for The Times to replicate the move in San Francisco and Texas. But what was generally deemed a journalistic success faced troubles in generating enough revenue to be self-sustaining.
It went under after two and a half years but not before several of its board members, led by prominent Chicago private equity executive John Canning, purchased The Sun-Times.
The group included Ferro, who became first among equals in running the paper.
But all along there was the strategic notion of melding the paper with The Tribune, given the obvious challenges of two papers operating successfully in the same major market. Former Tribune business editor Jim Kirk serves as editor and publisher of The Sun-Times now after successful stints at Bloomberg News in Washington, the CNC and Crain’s Chicago Business.