Eli Broad made his fortune building affordable homes for Southern Californians, while Ron Burkle made his by filling their pantries with groceries.
On Wednesday, they joined in a bid to buy the Los Angeles Times’ parent, Tribune Co. If successful, the two billionaires with no newspaper experience might pull off one of their most audacious deals yet.
Broad and Burkle have spent millions cutting separate swaths across the landscape of Southern California arts, culture and philanthropy. Their bid is likely to be countered by another local billionaire, David Geffen, who is expected to make a separate offer for the newspaper.
Like Geffen, who made his fortune in music and movies, Broad and Burkle have egos to match their accomplishments. Some who know them question whether they could work well together as partners, prompting speculation they would divvy Tribune’s holdings of newspapers, broadcast outlets and the Chicago Cubs baseball team.
“The obvious question on everyone’s mind is where does the L.A. Times end up in all this? In whose hands and under whose direction?” said Steve Soboroff, president of Playa Vista, a former Los Angeles mayoral candidate and one of 20 community leaders who in September wrote to Tribune Co. protesting its plans for cutbacks at The Times. “There are all kinds of possibilities.”
Former Los Angeles Mayor Richard Riordan, who is an acquaintance of Burkle’s and hikes with Broad in the Santa Monica Mountains almost every Sunday, said he was not surprised to hear about the pair’s proposal.
Buying Tribune would be “an interesting game,” said Riordan, a multimillionaire venture capitalist who restructured Mattel Co. before going into politics.
“The part that would be fun would be selling off the parts of Tribune and being left with the L.A. Times,” he said. “But then what would you do?”
Riordan doubts that Broad and Burkle, both of whom have strong personalities, would be interested in running The Times as co-owners.
Two people who know both men in business and civic circles agreed. They described Broad and Burkle as “control freaks” but asked that their names not be used because they didn’t want to antagonize the billionaires.
“There is no way they are gonna live together running that newspaper,” said one, who described them as “not friends but not enemies” either.
“Knowing them,” he added, “they better divvy it up before they make the deal and not after. And they are both gonna want the cream. If you live in L.A., the L.A. Times is the cream.”
Broad, 73, the only child of Lithuanian immigrants, was born in New York and raised in Detroit, where his father was a house painter and the owner of several dime stores. At age 20, he became Michigan’s youngest certified public accountant.
In 1957, he co-founded Kaufman & Broad Home Corp., which grew into the largest builder of moderately priced homes in the West. He later bought Sun Insurance Co. and made billions when American International Group Inc. bought the company, then SunAmerica, in 1998.
By then Broad was a longtime resident of Los Angeles, where he has immersed himself -- and a good chunk of his fortune, which Forbes has put at $5.8 billion -- in arts groups and civic organizations.
In the last two years alone, he has contributed more than $60 million to the Los Angeles County Museum of Art, where he is a board member, and which is now putting up a new contemporary art building bearing his name. Broad led the fundraising for Walt Disney Concert Hall, pitching in $18 million of his own money. He has also been a central figure in the effort to revive Grand Avenue as a cultural and economic force downtown.
Although few would question Broad’s generosity, some in the Los Angeles business community wonder privately whether he is serious about buying Tribune. Among other things, they cite his prominent mention as a likely buyer of the Los Angeles Dodgers when News Corp. put the team up for sale several years ago. Some questioned whether he was serious when he made an 11th-hour bid to buy the team if Bostonian Frank McCourt did not make good on his offer.
How ownership of The Times by men who have been covered regularly in its news pages -- and not always flatteringly -- would play out is hard to gauge, said Marty Kaplan, associate dean of the USC Annenberg School for Communication.
Some moguls, such as New York Daily News owner Mort Zuckerman, “buy a newspaper because they want it to be an extension of their voice and views,” Kaplan said. By contrast, the Graham family, controlling owners of the Washington Post, “voluntarily erect walls between their ownership and their power to influence the paper.”
Refraining from meddling in coverage can be very difficult for owners, he said.
“I know if I owned a paper, I would find it very hard to read unflattering coverage of myself or my friends and not want to pick up the phone,” Kaplan said. “One would like to think that Mr. Broad and Mr. Burkle ... understand that for The Times to thrive, they have to voluntarily manacle themselves.”
Burkle, 53, made his first fortune in the supermarket business. The son of a Stater Bros. executive, he was a vice president at age 29 when he put together an unsuccessful bid to buy the chain. Burkle multiplied his wealth by buying, merging and selling supermarket chains including Ralphs Grocery Co. and Food4Less. Forbes has estimated his wealth at $2.5 billion.
Burkle, who heads Los Angeles-based Yucaipa Cos., also built a record of social and community responsibility through his Food4Less Foundation, which gained a reputation as one of the most active philanthropic groups in Southern California.
He made an unsuccessful bid this year for 12 Knight Ridder Corp. newspapers when that company was broken up.
Geffen has made no secret of his interest in acquiring The Times.
Like Broad and Burkle, he has donated millions, including a pledge in 2002 of $200 million to the UCLA Medical School, which now bears his name.
Geffen, who is worth $4.6 billion according to Forbes, made his money buying and selling record companies in the 1970s and ‘80s. In 1994, along with Jeffrey Katzenberg and Steven Spielberg, he launched a new studio, DreamWorks SKG.
With a few hundred million dollars, Geffen has quietly built one of the best collections of postwar contemporary art in the country, consisting of fewer than 50 works that he mostly keeps in his Beverly Hills, Malibu and Manhattan homes, rarely lending to museums. He favors abstract expressionism and Pop Art from the late 1940s to the late 1960s, including works by Jackson Pollock, Jasper Johns and Willem de Kooning.
In the last two months, he has sold three artworks for a combined $283.5 million, fueling speculation that he is raising cash to buy The Times. These include the $140-million sale this month of a Jackson Pollock drip painting that stands as the costliest art sale ever made public.
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Source of wealth:
Home building, financial services
Philanthropy: The 73-year-old has given $60 million for a new Los Angeles County Museum of Art gallery, $23.2 million for an art center at UCLA and millions to Walt Disney Concert Hall, the Museum of Contemporary Art, Caltech, Pitzer College and USC.
In the news: In 2005, he paid $23.8 million for David Smith’s “Cubi XXVIII,” the highest price for a contemporary artwork sold at auction.
Sources: Forbes, Times research by Scott Wilson
Source of wealth:
Buying, selling and merging supermarkets
Philanthropy: The 53-year-old has donated $25 million to UCLA Medical Center and $10 million for an international relations center at UCLA and has given to Walt Disney Concert Hall.
In the news: In March, he videotaped New York Post gossip writer Jared Paul Stern allegedly trying to extort more than $200,000 from the mogul.
Source of wealth:
Music and movies
Philanthropy: The 63-year-old has pledged $200 million to UCLA’s medical school (now the David Geffen School of Medicine) and given $5 million to UCLA’s Westwood Playhouse (now the Geffen Playhouse).
In the news: In 2005, he gave up a three-year legal fight to block public beach access next to his Malibu home.
Sources: Forbes, Times research by Scott Wilson