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The Los Angeles Times owner was chosen as the top bidder in a bankruptcy auction for the Riverside Press-Enterprise and the Orange County Register that lasted until late in the night on Wednesday.
If the cash purchase of $56 million of Freedom Communications receives approval at the Monday bankruptcy court hearing, it would represent a deep expansion for Tribune Publishing in Southern California.
The company last year purchased the San Diego Union-Tribune and is looking at extending its reach across Southern California as well as save money through streamlining certain business operations during a time when a struggle by newspapers to stay profitable is commonplace.
Justin Dearborn the CEO at Tribune Publishing said in a prepared statement on Thursday that the successful bid for Freedom Communications would allow the Press-Enterprise and O.C. Register to continue to provide a local voice in each of their communities as well as deliver premium news along with information to the consumer across all of Southern California.
Tribune Publishing was able to beat out two bidders also vying to buy Freedom, including national newspaper chain Digital First Media with holdings that include the Los Angeles Daily News as well as eight other newspapers across Southern California.
A group of insiders, which included Rich Mirman the CEO and co-owner of Freedom and Mike Harrah a developer, withdrew from the bidding on Wednesday evening a few hours after the negotiations and just prior to the official start of the auction.
The insider group had complained over the fairness of the entire process including the way in which their bid had been valued.
Leonard Shulman an attorney said the group currently was considering if they should protest Wednesday’s auction.
Other objections might come from the anti-trust division of the Justice Department, which delivered a letter to an attorney for Freedom on Tuesday that indicated it would be intervening if Freedom’s assets were won by Tribune Publishing.
In the letter, the DOJ anti-trust unit wrote that they believed the acquisition of assets of Freedom by Tribune Publishing posed a risk to newspaper readers as well as advertisers in Riverside and Orange County.