Sun-Times: The most jinxed newspaper
Joe, whose last name is supposed to sound like a Bronx cheer, didn’t mean any harm. It’s just that bad luck followed him everywhere he went. Cars crashed. Pianos fell on pedestrians. Joe couldn’t catch a break. And neither could those around him.
In other words, he was just like the Sun-Times, which is about to enter its 25th year of colorful, sometimes criminal and almost always dysfunctional corporate governance. The big question is whether it will make it to its 26th year.
The latest twist in the paper’s quarter-century of unparalleled bad karma is that the board of directors of the parent Sun-Times Media Group today was ousted by dissident shareholders who are rightfully dissatisfied that the company’s stock – which closed at $15.58 on Dec. 31, 2004 – is now worth 9 cents a share. In that period of time, more than $1.25 billion in shareholder value went up in smoke.
Now, the company, which has been struggling with declining circulation, tumbling revenues and faltering profitability for more than two decades, is about to undergo another in a long, long, long line of tumultuous management turnovers.
Given the fragile state these days of the newspaper business, it’s hard to see how the dangerously depleted Sun-Times is going to get out of this alive, especially as the No. 2 newspaper in what, at best, has become a 1½ newspaper town.
The company has suffered $31.2 million in operating losses in the last 12 months on $331 million in sales. With the $99.8 million in cash the company had in the bank at the end of September, it theoretically could sustain three more years of such losses, assuming sales don’t weaken, expenses don’t rise and the company can extinguish some $600 million in assorted tax liabilities.
That is a lot of “ifs.” As an alumnus of the paper and loyal son of Chicago, I hope the Sun-Times makes it. If only it could get out from under that black cloud…
When the jinx began
I can tell you exactly when the spell of bad luck began, because I was there.
The year was 1984 and I stepped into the elevator near the newsroom for the short, four-story ride to the first floor. The only other person in the elevator was the then-publisher of the paper, Marshall Field V, who I, the mere city editor, barely knew.
“Don’t worry,” volunteered Marshall, who never had spoken to me in his life. “I would never sell the paper to Rupert Murdoch.”
That’s when I realized the paper was about to be sold to Rupert Murdoch. Within days, I proved to be right.
The staff was rooting for the purchase of the paper by our editor, the dashing James F. Hoge Jr., who pulled an all-nighter to come up with an eleventh-hour bid to match Murdoch’s $90 million price. But Marshall and his brother Ted evidently decided they would rather sell the paper to Murdoch than let their family treasure fall into the hands of the hired help.
It was on a wintry day in early 1984 that Rupert Murdoch came to town to claim his prize. He arrived in the company of an over-cologned guy named Robert Page, who not only carried the title of publisher but carried Rupert’s suitcase, too.
They appointed a couple of Fleet Street castoffs as co-editors, who rapidly turned our thoughtful, respected and reasonably prosperous tabloid into a scandal sheet with such headlines as this red, front-page screamer: “MEN CAN HAVE BABIES, TOO!”
The Fleet Streeters rapidly ran off not only readers and advertisers but about a fifth of the news staff, too. I was among them, soon venturing to San Francisco but leaving my heart in Chicago.
Meanwhile, there was never to be another dull moment back at the Sun-Times.
In a guru’s thrall
Within a couple of years of acquiring and plundering the Sun-Times, Murdoch decided to begin buying the national chain of television stations that formed the basis of what today is the Fox Network.
Because federal rules prohibited him from owning a newspaper and TV station in the same market, Murdoch decided to sell the Sun-Times to Bob Page, who bought the paper for $144 million in 1986 with the backing of a New York investment firm called Adler & Shaykin.
Page’s reign lasted a couple years, marked among other things by his infatuation with a guru in India whose gifts were celebrated in the newspaper from time to time in stories ordered up by the publisher.
Page departed in the summer of 1988 “after he lost an intense power struggle with the newspaper's chief financial officer, Donald F. Piazza,” according to the New York Times, which added: “Earlier, Mr. Piazza had brought about the ouster of two of Mr. Page’s lieutenants.”
Charles T. Price, a hard-nosed labor attorney who had been brought in as the newspaper’s general manager, replaced Page as publisher. Price oversaw a series of acquisitions that rolled together nearly 90 suburban and outlying newspapers into what potentially could have been a powerful marketing and ad-sales network.
The operative word here is “potential.” For all the opportunity that the acquisitions promised, a host of cultural, technological, union, managerial and other issues left the company with an unwieldy collection of properties that performed, to put it generously, in a sub-optimal fashion.
Casting about for an exit, the New York investors in 1994 sold the papers for $180 million to Hollinger International, a Canadian publishing company with global pretensions helmed by the buccaneering (and, we later learned, crooked) Conrad Black.
That’s when things went from bad to worse.
Next: Fading to Black
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