Billionaire Beats Out Chains to Buy Santa Barbara News-Press
Wendy P. McCaw, a billionaire environmentalist and ex-wife of cell-phone king Craig McCaw, has agreed to buy the Santa Barbara News-Press, bucking a national trend toward newspaper consolidations and corporate ownership.
The sale would transfer the 155-year-old newspaper from the corporate family of New York Times Co. into the hands of one of Santa Barbara’s wealthiest but lowest-profile citizens, who has no background in newspapers or journalism.
So publicity-shy is McCaw, 48, that the News-Press itself had never written about her before the proposed sale was announced Sunday.
“I know very little about her, except that she’s an environmentalist, a vegetarian and has a great deal of money,” Santa Barbara Mayor Harriet Miller said.
Media analysts say a sale to a wealthy individual like McCaw could mean that the News-Press won’t have to face many of the financial pressures that come with being part of a large, publicly traded newspaper chain, but they also question whether McCaw will allow the paper to operate independently or use it as a sounding board for her social issues.
“She’s an unknown quantity,” newspaper analyst John Morton said. “One hopes that she will observe journalistic values. But in the end, the owner can do whatever the owner wants.”
McCaw--who is worth about $1.5 billion, according to Forbes magazine--declined to be interviewed. But aides say she was motivated by a desire to bring local ownership to the newspaper she reads every day and save its historic downtown Santa Barbara office.
“The News-Press has long had a central place in the community, and she thought it should be owned by a resident of the community,” said Joseph Cole, general counsel at McCaw’s Santa Barbara-based investment arm, Ampersand Holdings. “She didn’t want to see the kinds of cutbacks that might come from a new owner.”
There are no plans for layoffs and McCaw will leave day-to-day management to Publisher Allen Parsons, though she might share her views with the publication’s editorial writers, Cole said.
The newspaper’s leaders, who have met with McCaw in recent weeks, said they are optimistic that she will preserve the paper’s editorial independence.
“She’s not buying the paper to turn it into a mouthpiece,” Parsons said. He added that many newsroom employees had been hoping McCaw’s bid would succeed because they preferred local ownership to being part of a larger chain.
In an era of ever-growing media mergers, including the $6.8-billion acquisition of Times-Mirror Co. (including the Los Angeles Times) by Tribune Co., analysts said it is rare for a family or individual to buy a newspaper in a major market.
McCaw reportedly beat out three newspaper chains for the 45,300-circulation paper: Copley Press, MediaNews Group and Howard Publications. Terms of the sale were not disclosed, but analysts estimated the News-Press would fetch more than $90 million.
“This is surprising given what’s been going on in the newspaper business,” said Ben Bagdikian, journalism professor emeritus at UC Berkeley. He said most sizable newspapers that have been put up for sale in recent years have been swallowed by national chains, such as Gannett Co., which last month agreed to buy Central Newspapers Inc., owner of the Arizona Republic and Indianapolis Star.
In most cases, families or individuals have been sellers, not buyers, of newspapers.
“But there are a lot of new millionaires and billionaires running around out there with more money than they know what to do with,” Bagdikian said, adding that he would not be surprised to see a handful of other small or mid-size newspapers acquired by families or individuals. “Newspapers still have a certain romantic and civic attraction.”
Though New York Times Co. does not break out profit figures for its papers, the News-Press reported Sunday that its net income last year was between $4.5 million and $6 million, on revenue of $30 million.
New York Times, which bought the News-Press in 1985, put the Santa Barbara publication and several other small holdings up for sale in February, saying it planned to focus on its larger regional newspapers.
The News-Press deal, subject to regulatory approval, is expected to close by September.
In a prepared statement, McCaw, who settled in a $9-million beachfront estate in Santa Barbara after her 1997 divorce, said her 23 years of experience building cable and wireless communications businesses with her ex-husband could be helpful in running a newspaper.
“Most of my adult life I’ve been involved with advanced forms of communications technology like wireless-telephone and satellite systems,” she said. “I’m looking forward to working with the News-Press management team in further improving this newspaper, as well as finding ways to apply technology to this important form of communication.”
As an active environmentalist, McCaw also expressed a desire to use more environmentally friendly materials for newsprint, replacing trees with rice or other plants.
Her Wendy P. McCaw Foundation has funded a variety of environmental causes, including reducing ocean pollution and wildlife preservation.
McCaw met Craig McCaw as a history major while both were attending Stanford University. The couple married a year after graduation, in 1974.
Wendy McCaw’s interests in preserving architecture and the environment should win her many fans in Santa Barbara, where growth and development are hot-button issues, Miller said.
“Her heart seems to be in the right place,” the mayor added.