Is the Los Angeles News Group about to go on the market as part of its parent company’s sale?

The question follows last week’s report by Ken Doctor, an analyst in the Bay Area who follows the news industry.

The report, published on the Neiman Journalism Lab’s website, said that the parent company, Digital First Media of New York, is cutting costs and a sale is likely as a result.

Rick Edmonds, a media business analyst at the Poynter Institute in St. Petersburg, Fla., came to that same conclusion after speaking with industry sources.

Doctor told the Business Journal that the majority shareholder of Digital First, New York hedge fund Alden Global Capital, will begin a process to sell the company this year. Doctor expects the company will be broken up by geography, with the L.A. papers going up for sale as a unit.

“I think what will happen is segmentation by geography, with four, five or six groups, and the Lang papers as one of them,” he told the Business Journal.

He said Digital First made its intent to sell clear last week with a decision to cut its costly digitally focused news-gathering experiment in New York. The venture, Project Thunderdome, produced national news stories for use in Digital First’s 75 local papers, including Lang’s, and related websites. The closure was part of a plan to cut at least $100 million of costs to improve operating profits to make the company look better to a buyer.

Along with the L.A. papers, which include the Los Angeles Daily News and Long Beach Press-Telegram, Digital First has papers in Denver, the Bay Area and other parts of the country.

A sale of the entire group might be preferable for the owners, but could be difficult, as it was for Tribune Co., the parent company of the Los Angeles Times. Tribune was looking for a buyer to take over all of its papers, including the Baltimore Sun and Chicago Tribune last year, but couldn’t find one.

A possible buyer for the Lang papers could be Aaron Kushner’s Freedom Communications of Santa Ana, which previously expressed interested in buying the Times and has bought other papers in Southern California, including the Orange County Register. The company already is under way on the launch of its own daily L.A. paper, the Los Angeles Register, which will begin publishing this month. Doctor said he thinks Freedom would only be interested at a fire-sale price.


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