Maxwell, 9 Unions Agree to Rescue N.Y. Daily News : Media: He must still strike a deal with Tribune Co. to complete his purchase of the crippled tabloid.

After a frenzied six days of round-the-clock negotiations, British press baron Robert Maxwell jubilantly announced Tuesday that he had reached agreements with all nine striking unions at the New York Daily News, clearing the way for him to buy the financially ailing tabloid three days before it was to be shut down.

“It’s been a long week, but common sense prevailed,” said the heavyset, bushy-eyebrowed publisher, who sported a red knit clip-on bow tie that he had worn all week and a newly acquired Daily News baseball cap.

“We have a deal . . . which in our opinion is historical, unprecedented and necessary to guarantee the return of the Daily News,” he said at a news conference at Macmillan Inc., his American publishing headquarters.

Maxwell still must negotiate a final agreement with the Daily News’ owner and founder, Chicago-based Tribune Co. The company had put the 71-year-old paper up for sale two weeks ago, after eight months of fruitless labor negotiations failed to wrest concessions from the unions that Tribune Co. said were necessary to restore the paper’s financial health.

Daily News Publisher James Hoge quickly sent a signal that a final agreement with Tribune would not be difficult. “Excellent progress has been made,” he said in a prepared statement. “We are optimistic that all further conditions can be met.”

Maxwell, whose candid and warmly personal negotiating approach contrasted with the imperious and intimidating style of Tribune negotiators, persuaded the unions to cut 800 of their 2,300 jobs for an annual savings estimated at more than $70 million.

Most of the News employees who will lose their jobs will receive buyout bonuses of about $40,000 apiece.

“It’s not easy for us as union officials to let 800 jobs go,” said George McDonald, president of the Allied Printing Trades Council, an umbrella group representing the striking unions. But McDonald and other union leaders cited the larger number of jobs saved and called the settlement a victory for the collective bargaining process.

The settlements with Maxwell still have to be ratified by the rank and file membership of each union, but faced with the alternative of the paper’s closing, union leaders expect swift approval.

Tribune Co. actually will pay Maxwell $60 million to take the tabloid off its hands. In exchange, Maxwell will assume all long-term liabilities, including up to $150 million in severance and pension costs if the paper eventually were to close.

Such arrangements are not unusual for the sale of troubled newspapers. “A typical deal for a paper (that is ailing) is the buyer pays the value of the physical assets,” newspaper analyst John Morton of the brokerage firm of Lynch, Jones & Ryan in Washington said.

Often, that amounts to the buyer paying the price of the real estate, getting the newspaper with it, in effect, for free. As an example, New York real estate magnate Peter S. Kalikow bought the New York Post from Rupert Murdoch for the $37.6 million its property was estimated to be worth in 1988.

In the case of the News, Tribune is keeping the most valuable physical asset, its 40% share in the News’ Art Deco headquarters on East 42nd Street. Maxwell is acquiring only the News’ three printing plants, all of which need modernizing estimated to cost $350 million to $500 million.

The new Daily News owner was born in Czechoslovakia in 1923 and went to Britain as a refugee after World War II. He went on to build a business empire that includes Macmillan Inc., Collier’s Encyclopedia, Berlitz Language Schools and the European, a newly launched English-language newspaper for Europe.

But he is best known as the publisher of racy and sensational London tabloids, such as the Daily Mirror.

He said he will acquire the Daily News, the brazen New York tabloid that declared: “So What?” in a headline when American astronauts landed on the moon, as a family-owned enterprise and not as part of his public holdings.

“It certainly will be my pet,” said Maxwell, who is noted for his hands-on and autocratic style. He said he intends to serve as publisher for at least the first six to 12 months of the paper’s new life.

Despite reductions in jobs as great in number as those sought by Tribune in earlier talks, reactions by striking union workers to the settlement with Maxwell combined relief with a sense of victory.

“Overall, it’s better to have a job when the economy is pretty bad and so many people are out of work,” said Larry Sutton, a striking feature writer who served on the negotiating team for the Newspaper Guild. “We have a new owner who is very enthusiastic. We’re showing the Chicago Tribune what can be done when you have a publisher who’s truly interested in the paper.”

But Eddie Borges, 27, a striking reporter who has been with the Daily News for a little more than a year and is likely to lose his job, said: “I’m just very numb right now.”

Maxwell’s entrance into the New York newspaper arena began when talks with an American buyer, Mortimer Zuckerman, publisher of U.S. News & World Report and the Atlantic Monthly, collapsed two weeks ago. Zuckerman wanted Tribune to pay him $80 million for the paper.

Maxwell, the second and final hope as a buyer, began his negotiating session a week ago by telling the unions precisely how much he wanted to cut. But the bargaining, which Maxwell and only a handful of aides conducted with unions in nine different rooms, almost collapsed over the weekend when he submitted a proposed contract that contained language about management rights to set work rules and staffing levels that was almost identical with the most controversial aspects of the Tribune proposals.

Maxwell even returned to London for his wife’s birthday party and threatened not to return. A hastily drafted letter to unions, written by one of his aides, called the language a mistake. Union passions were calmed and the talks were set back on track.

Over the next three days, Maxwell demonstrated his penchant for wearying all-night negotiating and yet established a growing sense of trust. On Monday, he extended a 10 a.m. deadline for a settlement by 14 hours to midnight.

When the new deadline came, Maxwell had four unions in his pocket and two more on the brink. The clock was then stopped to allow the talks to continue. By 5 p.m. Tuesday, the last unions had fallen into line.

The deal will leave New York, which once had as many as 11 daily metropolitan papers, with four: the Daily News, the New York Times, the Post and New York Newsday. The last is a sister publication to Newsday on Long Island and is owned by Times Mirror, publisher of the Los Angeles Times.

The proposed sale to Maxwell also saves a paper that has been an integral part of the nation’s largest city since 1919, and until last year was the nation’s largest metropolitan daily.

The News’ circulation peaked in 1947 at 4.7 million on Sunday and 2.4 million daily. But with its traditional blue-collar readership moving to the suburbs and turning to television, the News has been struggling to stay financially viable for more than a decade.

Tribune tried to sell it in 1982 and even offered media magnate Joseph Albritton $100 million to take it. But the sale foundered when adequate concessions could not be won from the unions.

Over the next eight years, Tribune tried to restore the paper’s health. Then two years ago, with a new president at the helm, the company decided it needed to take control away from the unions.

Its all-or-nothing bargaining strategy included planning on a strike, which broke out Oct. 25, but management found that it could not persuade most newsstand dealers to carry the paper amid union threats and intimidation. It also underestimated union sympathy in the city among News readers.

When the strike began, circulation was 1.09 million daily. It is now roughly half that by management’s calculations, and even smaller than that by the measurements of its competitors. The paper also lost its biggest advertisers, who switched to other tabloids and to television.

“From Maxwell’s side, it is a very risky proposition that he has taken on,” analyst Morton said. “It is going to be a very difficult thing” to turn the paper around.

Similar cases have had mixed results. For example, an attempt in 1980 by Cleveland millionaire Joseph Coles to buy the Cleveland Press for virtually nothing and turn it around failed when the Cleveland economy could not sustain it.

But Rupert Murdoch has succeeded beyond most people’s expectations in making the long-suffering Boston Herald modestly profitable after reinvigorating the editorial product. And Kalikow is surviving with the Post in part because of extensive concessions from unions. A key factor is that Kalikow frankly acknowledges that he is satisfied merely breaking even.

According to Tribune, the News lost $115 million in the 1980s and more than $130 million--much of it in planning for and weathering the strike--in the 1990s.

Nonetheless, Maxwell remained confident, saying Tuesday: “I am willing to go on record here that we will make a profit barring any unforeseen circumstances in the first year of operation.”

He said he also expected to begin publishing the newspaper in “a matter of days rather than weeks” after assuming control.

He indicated that he would retain the current editor, Jim Willse, but none of the replacement workers Tribune brought in to fill in for striking union employees.