By JOHN BRINSLEY
Staff Reporter
With last week’s announcement that the owner of the LA Weekly is up for sale, speculation immediately focused on one prospect: rival New Times Inc. But New Times already has been pretty much eliminated as a suitor.
Officials with Stern Publishing Co. said last week that the company was selling all seven of its alternative weekly newspapers, which include the long-established Weekly as well as the Village Voice in New York and the OC Weekly in Orange County. Analysts said the papers could have a combined value between $150 million and $200 million.
But Phoenix-based New Times, which runs a chain of its own alternative weeklies, including New Times Los Angeles, appears to be out of the running, apparently because of long-held philosophical differences between the two companies. The New Times papers have built a reputation for investigative journalism that is often combative.
“There’s no way they are going to buy any of the papers,” said a source close to Stern Publishing.
While he wouldn’t rule out selling off the papers piecemeal, Stern Publishing President David Schneiderman said the company intends to sell all seven papers together, because the national scope of the group would bring a better price.
“A national media emphasis means you can buy into more markets,” he said. “There’s more value that way, more synergy and more shared costs.” He said the price for the group could be “even higher” than $200 million. LA Weekly alone might sell for as much as $30 million to $40 million, according to Richard Karpel, executive director of the Association of Alternative Newsweeklies.
Both Schneiderman and LA Weekly Publisher Michael Sigman said they expect to continue in their jobs after the company is sold.
New Times executives in Phoenix didn’t return calls, and New Times Los Angeles Editor Rick Barrs said he is unaware whether the company’s owners plan to bid for Stern. “The corporate people keep their cards pretty close to the vest,” Barrs said. “I don’t know if they’re even interested in it.”
More likely candidates would include other broadcast, newspaper or magazine companies, investor groups and Internet firms, Schneiderman said.
The most intriguing scenario would be for an Internet company such as America Online Inc. or L.A.’s Ticketmaster Online-CitySearch Inc. to buy the weeklies and capitalize on their listings and reviews of music, movies, live performances and restaurants.
“Revenue for weeklies and online sites both come from ads for entertainment,” said Don Hazen, executive director the Independent Media Institute, a San Francisco media watchdog group. “Companies like AOL that are trying to do local listings and buy into the local market would be interested. And with their stock prices, they have a huge amount of money.”
When New Times entered the L.A. market three years ago after buying and closing two smaller local alternative newsweeklies, its intention was to unseat LA Weekly, now in its 21st year, as the premier alternative paper in the city. But LA Weekly has thrived under the competition. The average size of the paper is 216 pages, up from 200 pages last year, Sigman said. Advertising revenue is up 10 percent to 15 percent, and circulation is about 220,000.
Not that New Times isn’t putting up a good fight. Its average size is up to 112 pages, from around 92 pages a year ago, Barrs said.
