A group of investors, with big labor backing, raised enough money to purchase Chicago’s oldest continuously published daily newspaper, the Chicago Sun-Times.
The group, led by former Democratic city councilman Edwin Eisendrath and the Chicago Federation of Labor (CFL), raised “in excess of $11.2 million,” according to Bob Reiter, CFL’s secretary-treasurer, Monday.
The group met a 5 p.m. Monday deadline set by the Department of Justice to show proof of funding to operate the newspaper.
The group comprises of Eisendrath, several local labor unions and about eight individual investors, including corporate restructuring expert Bill Brandt, according to the Sun Times‘ own reporting.
The local Chicago News Guild, which represents members of the news media in the city, applauded the news, asserting that Eisendrath’s bid is the best option to keep the Sun Times strong and independent.
“We hope the Wrapports board and the U.S. Justice Department will look on it favorably,” David Roeder, a consultant for the Chicago News Guild (which represents Chicago Sun Times reporters) said Monday.
The bid is seen as an attempt to block the sale of the Sun Times to cross-town rival, The Chicago Tribune. Tronc, which owns the Tribune and other newspapers including the Los Angeles Times, announced in May that it had entered into talks with Wrapport Holdings, which currently owns the Sun Times.
After the Department of Justice’s Antitrust Division encouraged Wrapports to solicit additional bidders in an effort to preserve competition in the city’s newspaper business, Eisendrath committed to making a competitive bid for the Sun Times.
The CFL, which is the umbrella organization for over 300 unions affiliated with the American Federation of Labor and Congress of Industrial Organizations (AFL-CIO), joined Eisendrath’s group of investors.
“To me, news is about community,” Eisendrath explained to local media reporter Robert Feder in mid-June. “Fox News built a community of people around a shared view of the news. That’s not a view that resonates with me, but I think there is a community of people that are a little bit progressive but don’t like or want the elite part.”
Eisendrath served as the alderman for Chicago’s 43rd ward and ran for Illinois governor in 2006, when he lost in the Democratic primary to Rod Blagojevich.
“Nothing that comes out of the East Coast of the United States is ever going to pass the test of non-elite,” Eisendrath said. “I do love the Washington Post. I do love the New York Times. But they are elite. They’re proud of that. But that’s not where we want to be.”
The Sun Times has been in troubling financial shape for well over a decade as advertising revenue and circulation declined. In 2007, the paper’s owner was convicted of fraud for allegedly stealing millions from the company.
Real-estate developer Neil Bluhm has also shown interest in acquiring Wrapports, according to Crain’s Chicago Business. In addition to the Sun Times, Wrapports also owns Chicago Reader, a weekly newspaper in the city.
“It’s a big step, an important step, but it’s not the last step,” Eisendrath said Monday. “We still have work to do to finish a transaction.”
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