Sun Sentinel Palm Beach Edition
Former Tronc chair sells shares for $208M
Buyer is distant relative of Tribune founder McCormick
CHICAGO — Michael Ferro, who resigned last month as chairman of Chicago-based newspaper chain Tronc, has struck a deal to sell his entire stake in the company, according to a filing late Friday with the Securities and Exchange Commission.
Ferro, who as the largest shareholder owned more than 25 percent of Tronc, the parent of the Chicago Tribune and other newspapers, agreed to sell his more than 9 million shares for $23 per share, or $208.6 million, to McCormick Media, pending approval by regulators. Ferro owned the shares personally and through his Merrick Media and Merrick Venture Management entities.
The buyer, a distant relation to the McCormick family that controlled the Chicago Tribune throughout much of its history, approached Ferro within the past couple of weeks with the offer, according to a source familiar with the deal.
Sargent McCormick is listed in the SEC filing as the manager of McCormick Media.
Efforts to reach McCormick were not successful.
Ferro, a technology entrepreneur who previously owned the Chicago Sun-Times, became the largest shareholder and nonexecutive chairman of Tribune Publishing in February 2016 when he spent $44.4 million, or $8.50 a share, for 5.22 million shares in the company. In December 2016 he bought an additional 2.5 million shares at $15 per share for an additional $37.5 million.
The name of the com“Now pany, whose newspapers also include the Los Angeles Times and Baltimore Sun and other publications, was changed to Tronc, for Tribune online content. It was a tumultuous run for Ferro.
He stepped down from the board of Tronc in late March, just hours before Fortune published a story online accusing him of inappropriate sexual behavior toward two women while in his previous role as head of a Chicago investment firm.
In early January, the newsroom of the Los Angeles Times voted to form a union. A month later, Tronc announced plans to sell that paper and the San Diego Union-Tribune to Los Angeles biotech billionaire Patrick Soon-Shiong, Tronc’s second-largest shareholder, for $500 million in cash. That deal has not closed.
On Friday afternoon, Soon-Shiong said he was committed to holding onto his Tronc shares.
that the McCormick family have taken over Ferro’s stock, over the course of the next couple of weeks we will try to understand what their vision is,” he said. “But I’m pleased because they have the same values as I do.”
Earlier this week, some staffers of the Chicago Tribune announced plans to unionize the newsroom in what would be a historic move at the 171-year-old newspaper.
In an emailed statement to employees, Tronc Chairman and CEO Justin Dearborn noted that the company itself was not involved in the transaction. “I want to emphasize that this is a private transaction between Merrick and the buyer and does not alter our business strategy or the pending sale of the California News Group,” Dearborn wrote.