Independent Publisher Buys S.F. Examiner

The Hearst Corp. announced Friday that it is selling the San Francisco Examiner to a feisty, independent publishing company, assuring the survival of a struggling newspaper that had been threatened with closure.

The deal maintains two major newspaper voices in a wildly diverse city that demanded as much. Observers predicted it might simultaneously reinvigorate the city’s largest paper, the Chronicle, purchased by Hearst.

The sale completed a week of seismic shifts in California’s historic newspaper landscape. First, the Chandler family ended more than a century of its control of the Los Angeles Times by proposing to merge it with Chicago’s Tribune Co. Then on Friday, the paper that once was the legendary William Randolph Hearst’s flagship was sold to a local family that will become the only Asian American owners of a metropolitan daily in the state.

Buyer Ted Fang immediately pledged to shift the 105,000-circulation Examiner from afternoon to morning publication, where it will compete head to head with its longtime rival, the 465,000-circulation Chronicle. The Chronicle will be published by the New York-based Hearst Corp.

“As so many public officials had hoped, two voices will be preserved,” said Examiner Editor and Publisher Timothy White, who will assume the same title at the Chronicle. “We will be able to get on with the task of creating a world-class newspaper for California.”

Hearst Pledges Financial Support

Financial terms of the sale were not immediately released, although the Hearst Corp. agreed to provide unspecified financial support to allow the Examiner to get on its feet before the two sever all ties.

The deal was designed to clear away the federal antitrust concerns that surrounded Hearst’s purchase of the Chroniclelast summer, which threatened to leave this city with only one major newspaper. The sale dissolves a federally approved joint operating agreement.

Fang’s family already operates the thrice-weekly alternative Independent newspaper in San Francisco and San Mateo counties and produces the national tabloidAsianWeek. The executive promised to be a “very aggressive competitor” in the city’s traditionally spirited newspaper rivalry.

“The Chronicle is [the] largest newspaper in Northern California and it serves the entire Northern California market,” Fang said. “The Examiner will be San Francisco’s newspaper.”

Politicians, community leaders and residents cheered the takeover by the Fang family, already politically active and strong supporters of Mayor Willie Brown.

Brown was in Paris for the World Conference of Mayors but his spokesman said the mayor was “excited that . . . the citizens of San Francisco will continue to be served with two daily newspapers.”

The Examiner has been known for its iconoclastic columnists and punchy municipal coverage, but it has been struggling for years. The newspaper’s future appeared to be in jeopardy in August, when the Hearst Corp. announced its purchase of the Chronicle and said it would close the Examiner if a buyer did not come forward.

The New York company sweetened the deal for potential buyers in January when it added the Examiner’s trucks and presses to the original offer, which included the paper’s name and subscriber list.

The deal will change the faces of both of the city’s newspapers.

In a screaming Page 1 headline Friday afternoon, the Examiner announced “SOLD!” atop a picture of the staffs of the Chronicle and the Examiner gathered for the sale announcement.

The Examiner’s nearly 200 editorial employees are guaranteed jobs with Hearst. Most, if not all, are expected to join their once dreaded rival, the Chronicle, which has more than 400 employees.

Some Examiner reporters and editors questioned whether the new owners will maintain editorial quality.

Deputy Managing Editor Steve Cook said the sale is “the best possible result for people at the Examiner. We all get to have jobs at the new Hearst paper.”

However, he added, “I am saddened. . . . It is hard to have been associated with a paper for over 30 years and see the fate I anticipate. . . . I think it will be very difficult for this paper to survive.”

No Staff Members Volunteer to Stay

At a meeting announcing the new ownership, not a single hand went up when Examiner employees were asked how many would like to keep their jobs under the new management.

The Fangs’ new ExIn LLC company will have a four-month transition period to hire a new staff after the deal closes later this month. The deal does not include the Examiner building, which adjoins the Chronicle.

Fang said he will search nationwide for talent. He promised strong incentives for new employees, but declined to say if salaries or benefits would be competitive with those Hearst offered. Unlike the Chronicle and the Examiner, the Independent is a nonunion newspaper.

Among the other properties the Fang family acquired was the Examiner Web site and the Bay to Breakers annual road race.

But the paper will need more than a quirky athletic event to survive in the nation’s fifth-largest media market.

Gone will be the money-saving joint operating agreement that helped prop up the paper for decades by allowing it to share revenues, printing and distribution with the rival Chronicle.

George Irish, president of Hearst Newspapers, said the unusual financial help his company will pay to its new competitor, the Fang family, will give the Examiner a fresh start. But he predicted that the long-term operation of the Examiner “is going to be a challenge.”

The Fangs and the Independent--distributed free to 379,000 people--have shown in the past that they are game for a fight.

The Independent has for months waged a withering assault on the Hearst Corp. and its potential shutdown of the Examiner. An ongoing serial in the paper depicted Examiner Executive Editor Phil Bronstein as a weakling, dubbed “Mr. Stone,” for his marriage to actress Sharon Stone.

The free paper also created the Committee to Stop the Hearst Monopoly.

Purchase May Settle Battle Over Contract

While Ted Fang and his family have said the demise of the Examiner would have limited public discourse and damaged the civic landscape, their interests extended beyond the purely egalitarian. The Independent owners’ purchase of the Examiner appears to settle their years-long legal battle over which publication should get the lucrative contract to publish legal notices.

Fang said the family plans to run its new acquisition “our way,” and keep its intense local focus.

Hearst officials said they plan to use the deal to reinvigorate the Chronicle with former Examiner employees. They already are envisioning expanded local and regional coverage, beefing up reporting staffs in the state Capitol and placing staff members in Southern California and overseas.

“We have been in a circulation slide and we have to turn that around,” White said. He said the paper also will “need to be a multi-platform player,” referring to strengthening the paper’s Web site to serve a region that is an international hub of the high-tech industry.

San Francisco Supervisor Tom Ammiano said the Examiner sale is “a mixed bag.”

“I am a two-newspaper guy,” he said. “But I am concerned about the nonunion history of the Independent, and there has been some pretty partisan politics played in some races, one of them mine” against Brown for mayor.

“That is not a journalistic standard I see a big-city daily having, and I would hope they would change that.”

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Rainey reported from Los Angeles and Reiterman from San Francisco.