Tribune Publishing Company, which owns The Chicago Tribune and The Los Angeles Times, announced on Thursday that it has acquired a bankruptcy auction for the Orange County Register for $56 million, moving to control the largest daily newspaper in the region of Los Angeles. However, the US antitrust officials immediately responded with a lawsuit which sought to prevent the takeover.
According to The United States Department of Justice, the DOJ filed a civil antitrust lawsuit seeking to bar the purchase by Tribune Publishing Company. The company, which was chosen as purchaser of Freedom's newspapers following a bankruptcy auction, will seek bankruptcy court approval of its acquisition which is scheduled on March 21. The DOJ is seeking a temporary restraining order to prevent the acquisition of Tribune from proceeding.
The complaint indicated that the Los Angeles Times and the Register account for 98 percent of newspaper sales in Orange County and that the Times and Freedom's dailies together account for 81 percent of newspaper sales in Riverside County. Yahoo News reported that the Justice Department saw the whole scenario as an 'effective monopoly' allowing the publishing company to raise advertising rates, invest less to maintain the quality of its newspapers, and increase subscription prices.
Assistant Attorney General Bill Baer of DOJ said if the acquisition will be allowed to move forward, newspaper competition will be eliminated and advertisers and readers in Riverside and Orange Counties "will suffer."
The Tribune Publishing's aggressive bidding comes merely weeks after the company's ownership, including its management, was overhauled. The Tribune's interest in the assets of Freedom was widely known. Tribune offered $3 million to fund operations and the bankruptcy case of Freedom after the privately held company filed for bankruptcy protection and made assets open to bids from interested institutions, reports USA Today.
Tribune Publishing Company chief executive Justine Dearborn said that the takeover will allow the Press-Enterprise and Orange County Register to continue providing a distinct local voice in the communities while delivering premium news and information to the customers across Southern California.
