Pilot’s Publisher Fired in Argument Over Acquisition
Robert E. Page, the former Chicago Sun-Times publisher who bought the struggling Orange Coast Daily Pilot and seven other small Southland newspapers last year and vowed to improve their operations, has been ousted as publisher and president of Page Group Publishing Inc.
Page, who has 3 1/2 years left on a $200,000-a-year employment contract, said in a telephone interview Tuesday that he would fight the ouster. He already filed one lawsuit last week against his partners; they retaliated Monday by filing their own suit, firing Page and evicting him from his office.
The legal fight and Page’s ouster cap several months of growing conflict with Page Group Chairman Elliot Stein Jr. over the company’s nearly $2-million purchase of a Spanish-language weekly last year.
Neither Stein nor Page Group’s new executive vice president, James Gressinger, responded to several requests Tuesday for an interview.
Page, who owns 10% to 15% of Page Group, said he initially approved the acquisition of the Los Angeles-based paper, Tu Mundo, which means Your World, from a partnership that included Stein and movie moguls Jon Peters and Peter Guber. But Page said he later came to believe that the weekly paper’s assets were artificially inflated and that the group had paid too much to acquire it.
Page Group is a holding company for several publications in Orange and Los Angeles counties: the Daily Pilot, the Glendale News Press, six weekly newspapers and two small monthly magazines. The weeklies include the Huntington Beach, Fountain Valley, Costa Mesa and Newport Beach Independent newspapers in Orange County.
Page came to community journalism after publishing two metropolitan daily newspapers--the Chicago Sun-Times and the Boston Herald--for controversial media magnate Rupert Murdoch.
The longtime news executive is generally credited with turning around the Herald, increasing its circulation by 50%. But he was forced out at the Sun-Times as that paper’s circulation began slumping. In a preview of his current problems, Page wound up in a bitter battle with the Chicago paper’s board chairman, Leonard Shaykin, a New York investment banker.
Page came to Orange County in late 1989 and said at the time that he was excited about entering community journalism and that he was heading a group that intended to acquire “many” newspapers in a “tremendous market here that we haven’t even begun to tap.”
The record of the partnership, which apparently has unraveled, so far is spotty. The Glendale paper appears to be profitable, but the Pilot is still struggling and the magazines reportedly are in financial trouble. The organization recently trimmed more than a dozen editorial, circulation and advertising people throughout the system.
Page attributed the Pilot’s woes to the recession. Its circulation dropped 20% to 14,618 last September from 18,176 in March, 1989.
“We turned it into a terrific printing plant” with almost $400,000 in repairs and improvements to the Pilot’s printing presses, Page said, “but as a newspaper, it had a lot stronger viability until the recession.”
The Pilot prints The Times’s San Diego edition real estate and North San Diego County Focus sections every week.
Page termed the Glendale paper the Page Group’s “flagship as a financial success.” The paper has added 1,719 new subscribers since March, 1989, boosting circulation 24% to 8,877 by last September.
Page said he and Stein had been good friends until the Tu Mundo purchase in July, 1990. Page said he wasn’t involved in the deal because he was told that “it’s being handled by New York” and that he should stay out of it.
But after the acquisition, Page determined that his company had paid too much. One of his attorneys said Tuesday that the Spanish-language paper appears to have had assets of only $2,100 at the time it was purchased for $1.8 million.
“Stein led me to believe that it was, in a worst-case scenario, a break-even operation,” Page said. Instead, it was a money-losing operation, he contended.
Page said his friendship with Stein deteriorated as the two argued about the purchase.
A local communications expert who lunched with Stein recently said the two had a “big blowup” over Tu Mundo that set the course for Page’s ouster.
All Stein wanted to talk about was breaking into the Latino market, said the source, who did not want to be identified.
Page said he asked to review Page Group financial records kept at Stein’s New York investment banking company, Commonwealth Capital Partners. In his suit, filed in Orange County Superior Court May 9, Page alleged that Stein had refused to let him see the records.
In retaliation, Stein flew to Orange County from New York on Monday, filed a breach-of-contract suit against Page and ordered new locks installed at the corporate office in the Daily Pilot building, 330 W. Bay St.
Shortly before 5 p.m., Stein told Page that he was terminated as president of Page Group and as publisher of its newspapers. Stein called Costa Mesa police to evict Page, but the two men reached an accord before the officers arrived. The police simply watched as Page and his attorney copied various documents before leaving.
Page said he expects to file a complaint soon against Stein and the other investors for breach of contract.
Though he had a minority interest in the group, Page had the name recognition in the industry that made him an ideal corporate front man.
He enjoyed a well-heeled business lifestyle, spending money at some of the best clubs and eateries wherever he worked. The Page Group sent him on lunch and dinner rounds in Southern California and pushed him into trendy areas to meet people and generate business, the communications expert said.
“The investors flaunted him all over Orange County and Glendale,” the source said. “They trotted him out at the Center Club, the Pacific Club and every place else. They got him on the . . . celebrity circuit.”
But one thing that Page did by himself was to incur the wrath of many of his employees.
In interviews with several current and former Daily Pilot employees, some faulted Page for a dictatorial management style and others berated his news and management decisions.
Page’s reputation, forged out of 30 years in the newspaper business, is that of an energetic, almost charismatic executive with a love for promotion and a cold disdain for financial details.
Orange Coast Daily Pilot Circulation: Sept. 1985: 32,062 Mar. 1986: 30,404 Sept. 1987: 22,213 Sept. 1988: 20,157 Mar. 1989: 18,176 Sept. 1990: 14,618 * Founded: 1907 * Employees: 120 * Sister publications: Huntington Beach Independent, Fountain Valley Independent, Newport Beach Independent, Costa Mesa Independent, Corona del Mar Independent
Glendale News Press Circulation: Sept. 1985: 9,112 Mar. 1986: 9,024 Sept. 1987: 7,785 Sept. 1988: 7,741 Mar. 1989: 7,158 Sept. 1990: 8,877 Founded: 1905 Employees: 110 Sister publications: Foothill Leader, Burbank Leader Also owned by Page Group Publishing: Brentwood Bla Bla, Tu Mundo, Beverly Hills the Magazine Source: Editor & Publisher Yearbook, Los Angeles Times market reseach
