Second-highest bidder is OK'd to buy corporate owner of OC Register after DOJ files antitrust suit
Updated: A federal bankruptcy judge has approved the sale of the corporate owner of two California newspapers to the second-highest bidder in a bankruptcy auction after the U.S. Justice Department objected to Tribune Publishing’s plans to buy the company.
U.S. District Judge Mark Wallace approved the sale of Freedom Communications to Digital First Media on Monday, the Associated Press and the Los Angeles Times report. Digital First Media will pay $52.3 million for the company, which owns the Orange County Register and the Riverside Press-Enterprise.
Digital First owns more than 50 newspapers, including the Los Angeles Daily News. It “has a reputation for cutting costs and running a lean operation,” according to the Los Angeles Times.
The U.S. Justice Department filed a civil antitrust suit last Thursday that sought to block Tribune Publishing’s planned purchase of the company for a higher bid of $56 million, report the Wall Street Journal (sub. req.), the Los Angeles Times and the Orange County Register. The Justice Department filed the lawsuit hours after the Tribune Publishing deal was announced.
According to a Justice Department press release, the purchase by Tribune Publishing would have given the company a monopoly over newspaper sales in Orange and Riverside counties, allowing it to raise subscription prices and advertising rates, while investing less to maintain the quality of the newspapers.
A lawyer for Tribune Publishing, Jeremy Rosenthal, told the court he was confident the publisher would prevail on a trial on the merits, but “we do not have that time.” Freedom had said the federal government’s antitrust suit would delay a sale, causing Freedom to run out of financing.
