Digital First Media Steps-In With Offer For Freedom Communications

UPDATE 3/21/16 4:30PM:  A bankruptcy judge on Monday morning approved the sale of the Orange County Register and Riverside Press-Enterprise to Digital First Media for $52.3 million.

Digital First Media now runs 11 daily newspapers and more than a dozen community weeklies in Southern California and with the purchase becomes the largest news provider in the combined counties of Los Angeles, Orange, Riverside and San Bernardino.

In a news release, the company said it would "restore vitality" to the papers, which will be known as the Southern California News Group.

Earlier Posting...

Attorneys for The Orange County Register’s owner filed a motion Saturday asking a bankruptcy judge to approve the company’s sale to Digital First Media, the second-highest bidder in last week’s newspaper auction.

The $56 million bid by Tribune Publishing, owner of the Los Angeles Times, can’t be accepted because an eleventh-hour antitrust court order prevents the company from closing the deal on time, Freedom Communications lawyer William Lobel said.

“We’re going to go in and ask the judge on Monday to approve (Digital First Media) as the successful bidder,” Lobel said.

Digital First Media is the nation’s second-largest newspaper company by circulation, with 65 daily and Sunday newspapers and at least 265 websites in 18 states. The company owns the Long Beach Press-Telegram, Los Angeles Daily News and seven other Southern California newspapers.

Freedom’s request will be considered at Monday’s 9 a.m. hearing before U.S. Bankruptcy Judge Mark Wallace in Santa Ana.

The judge presides over the bankruptcy of Freedom Communications, which owns the Register and The Press-Enterprise in Riverside and is embroiled in its second bankruptcy in seven years.

The Register reports Wallace’s challenge changed late Friday when antitrust regulators won a key battle: U.S. District Court Judge Andre Birotte Jr. issued a temporary restraining order that halted Tribune’s purchase due to concerns that the deal may create a Southern California news monopoly.

It’s unclear if Tribune will try to fight; a hearing on the restraining order is set for March 28.

The Denver-based company also is the parent of the Los Angeles News Group, which owns nine Southern California papers: the Los Angeles Daily News, Long Beach Press-Telegram, Whittier Daily News, Pasadena Star-News, San Gabriel Valley Tribune, Torrance Daily Breeze, San Bernardino Sun, Inland Valley Daily Bulletin and Redlands Daily Facts. Its flagship papers are The Denver Post and San Jose Mercury News.

The company is owned by Alden Global Capital, a private hedge fund known for investing in distressed newspapers. Alden was one of several investors with a stake in Freedom Communications after its first bankruptcy in 2009.