Wednesday, July 3, 2019

Group with Canadian media ties could soon own 116-year-old Bend Bulletin


            The Bend Bulletin could soon be going the way of family-owned newspapers falling in the hands of chain owners that are acquiring troubled print media around the country.
 
            In a report the last week of June The Bulletin announced that Rhode Island Suburban Newspapers, or RISN, has offered to buy The Bulletin for $2.25 million as part of parent company Western Communications' Chapter 11 bankruptcy proceedings. The offer also includes the small Redmond Spokesman weekly.
            The Bulletin, founded in 1903 and at one time the daily flagship paper along with six weeklies owned by Western, has been controlled by the family of the late Robert Chandler, who acquired it in 1953. RISN has also previously offered to buy Western’s  Sonora (CA) Democrat for $1.15 million including that paper’s real estate.

            The Bulletin purchase would not include Western’s 87,000 square foot Bend headquarters and printing facility, on which New York based Sandton Master Limited Fund III holds the debt of approximately $19 million.
            Background on RISN and its various corporate and investor affiliations is not readily available online. Neither RISN nor Illinois headquartered Horizon Publications Management Services Inc., which some reports say is a related corporation, have active websites.
            RISN appears to be one of several related companies represented in public by Stephen Malkowich which have in recent months been acquiring newspaper properties in California and other locations. The Warwick, RI-based company, through various entities, also controls a number of small weekly and daily New England newspapers.              
           A 2009 agreement by RISN with the Providence (RI) Newspaper Guild showed that the company had health insurance and retirement plans for some non-management employees.
            A recent report in the Los Angeles Times noted that Malkowich is executive vice president of Alberta Newspaper Group based in Vancouver, BC. The Times reported that ANG  is headed by David Radler, who along with one-time Canadian media mogul Conrad Black served prison time for financial fraud.
            Malkowich’s LinkedIn profile shows that he graduated from the University of Manitoba in 1987 and has held various media sales and management positions in Canada including since 2011 with ANG in Vancouver.
            In the 2004  criminal fraud case, Radler testified against Black, a strong supporter of President Donald Trump who was pardoned by Trump in May of this year.The men were charged with illegally making payments to themselves in the form of no compete agreements and transferring companies within the US based Hollinger International, a publicly-held company, for less than market value, among other violations.
            While serving prison time in 2008, Crain’s Chicago Business reported that Radler settled a lawsuit against Trump after claiming the developer changed the terms of “friends and family” benefits in Radler’s offer of $1.7 million for a condo in one of Trump’s New York buildings.
            The Vancouver Sun reported in 2007 that Radler agreed to pay a fine of nearly $29 million to the Securities and Exchange Commission. He also agreed to pay $64 million in damages resulting from a lawsuit by Hollinger International, the company originally created by Conrad Black in 1986 and which owned papers in Canada and the US, including the Chicago Sun-Times. Black and Radler were business partners over three decades and were executives of Hollinger, with some reports that Radler was the “right hand man” as chief operating officer.
            The business disputes between Radler and Black extended well beyond Radler’s 2007 testimony against Black and after both went to prison for the criminal fraud.
            In 2009 Black sued Radler, daughter Melanie, Horizon Publications Inc., and other individuals and companies in an attempt to sell his then stake of 27% shares in Horizon. In 2015 an Illinois appellate court upheld a lower state court decision that sales of the company’s stock were restricted by granting Radler and others a purchase right of first refusal. http://illinoiscourts.gov/R23_Orders/AppellateCourt/2015/1stDistrict/1132116_R23.pdf
           

A lawyer-daughter assumes a leading role

            According to other published reports, Radler had been acquiring media properties along with his daughter Melanie (Radler) Walsh while the fraud case proceeded. She is listed as the chief executive of a company that recently purchased the Bakersfied Californian, as well as the Antelope (CA) Free Press and Lodi (CA) News-Sentinel. The Bakersfield buyer is listed as Sound Media.
Radler in 2007 - Bloomberg News
            The Illinois Secretary of State’s office lists Walsh as president of Horizon Publications Managent Services Inc., first registered in 1999 with the state and noted as a foreign coporation.
            At one time Walsh, a 1999 Northwestern University law graduate, was an attorney with the Chicago law firm Winston & Strawn, a firm that once included former Illinois Gov. James Thompson who was chairman of the audit committee for Hollinger International at the time the senior Radler and Black were prosecuted.
            Whether an interesting coincidence, or not,the Sound Media company involved in RISN-related California acquisitions is remarkably similar to Sound Publishing, another British Columbia-based company headed by a David Black, who is not related to Conrad Black.
            David Black’s company, Black Press, includes a stable of weekly newspapers near Seattle and elsewhere in the Puget Sound region, as well as the San Francisco Examiner and SF weekly; the Honolulu Star-Advertiser, and others in California.
            In a 2012 interview the Vancouver Sun reported that David Black has maintained a lower profile than the other Black, and joked that he sometimes capitalized on Conrad Black’s notoriety to get good tables at restaurants, “...just by saying he’s ‘Black, the publisher.'”
            Competing bids for The Bulletin and Redmond Spokesman must be at least $100,000 over that of the RISN group and be received by July 15.

July 2 front page
            The $2.25 million Bulletin offer when combined with the $1.15 million, including real estate, for the Sonora Democrat and earlier offers by other buyers of $775,000 for the Baker City Herald and LaGrande Observer and $350,000 for the Curry Coastal Pilot in Brookings together with Del Norte Triplicate in Crescent City, CA would bring in $4,525,000. An announced sale for $240,000 of the Redmond building once occupied by the Redmond Spokesman would bring the total to $4,765,000.,
            Backing out the value of $550,000 assigned to the real estate in the Sonora Democrat offer and the amount for the Redmond real estate, the sale of all Western Communications’ media assets only would total $3.975,000. Dirks Van Essen, the media broker representing Western had said earlier the news assets could fetch in a range of $5 million to $10 million.
            The Bend headquarters building remains listed for $18 million by a local commercial broker affiliating with a Portland broker, with earlier advertised leases available in a range of 5,000 to 20,000 square feet. The Bulletin continues to operate on lower floors of the facility and also prints several other publications at the location.
           
What would RISN’s ownership mean for The Bulletin?

            Maybe the best place to start predicting what RISN ownership would mean in Bend is to attempt to unravel its various corporate holdings and affiliations.
            And another path could be to delve into its record with publications it has acquired, from the perspective of those who have lived through the ownership transitions.
            In one sense RISN can trace its roots to a business relationship between F. David Radler and Conrad Black and a small Quebec, Canada town of Ravelston where the two came together to begin buying and operating newspapers. Over more than three decades they built a media empire that eventually coalesced under the umbrella of Hollinger International. The company once owned many small newspaper properties throughout Canada and the United States, and larger papers such as the Chicago Sun-Times and  the London Daily Telegraph.
            The Radler and Black relationship hit rocky ground in the early 2000s, when both were charged by the US Securities and Exchange Commission with a variety of criminal fraud violations involving self-dealing while leading publicly-traded Hollinger.
            Radler cooperated with prosecutors and both were sentenced, Radler to 29 months and Black to 72 months. Radler only served a year while Black served a total of about 42 months of a nearly 80 month sentence before his pardon by in May of 2019 by President Donald Trump, with whom he’s reported to have a lengthy friendship. Black has also authored a glowing book about Trump, “Donald J. Trump, a President Like No Other.”
            Today F. David Radler, in his mid-70s, maintains a low public profile as chief executive of the Alberta Newspaper Group (sometimes shortened to Alta or ANG) based in Vancouver, BC., while much of ANG’s acquisition activity through various companies is led by executive vice president Steven Malkowich. Radler’s daughter, Melanie Radler Walsh, is also listed as an chief executive with several companies through which Radler’s organization is buying newspapers in the United States.
            Illinois corporate records indicate that Horizon Publications Inc., at one time associated with Radler investments, went through “involuntary dissolution”  in 2004. But another Illinois corporation record shows that Horizon Publications Management Services Inc., registered in Delaware as a foreign corporation, has been active since 1999. The corporate secretary is listed as Roland L. McBride, who was involved in the federal investagion that resulted in prison sentences for Radler and Black. McBride's address is a commercial office in Marion, IL, the same city once connected to Horizon Publications Inc., a "dissolved"  Illinois domestic corporation.
            The website domain name horizonpublicationsinc.com associated with an outdated Bloomberg business profile does not load. But an inquiry with www.whois.com  that tracks domain registration information links the Horizon site to www.perfectprivacy.com,
a service of Perfect Privacy LLC, a Jacksonville, FL company that shields the identity of domain name owners.
            More than a decade ago an online profile of RISN said it owned six weeklies and five dailies in Rhode Island. In recent years those holdings have grown with several Connecticut newspapers, and other dailies and weeklies in California including the Bakersfield Californian, as well as Porterville, Antelope and Lodi, and the daily Yuma, AZ Sun.
           

Some opinions of RISN and affiliated companies

            In its report of acquistions involving ANG and representative Steve Malkowich, the Los Angeles Times quoted the former owner of the Lodi (CA) News-Sentinel, Marty Weybret: “He (Malkowich) very conspicuously did not want to show me how his organization worked.”
            Weybret told the times that Malkowich, “kept referring to Radler,” but never described his role, only that the senior Radler had a, “philosophy of newspapers.”
            Other comments from an industry insider and a newspaper owner informed of the Bulletin situation also shed some light on ANG and it’s operating style. 
            "I did business with those folks years ago and I can tell you it is not good," said the insider contact.
            "The newspaper industry does not need people like that. We should get better," he lamented. 
            A publisher who was approached by an ANG principal to sell his newspaper said, “I spoke to those guys and I wasn’t impressed.”          
            Of The Bulletin’s precarious situation,“That’s a tragedy,” he said , while noting he had in the past visited The Bulletin’s expansive headquarters facility.
            “It was insane,” he said referring to the size of the Bulletin facility. “But they weren’t the only ones.” 
            Many posts on the Internet job site Glassdoor are less than complimentary of the way ANG and affiliate owned newspapers are managed. Recognizing that such sites allowing anonymous posts can be misleading, those involving the median chain are detailed and appear to come from someone with direct experience.
            A recent post in May of this year, identified as from a Chicago area reporter, was titled “A Joke of a Company.”
            “This company does not care about having true content and covering news in their communities...In the short time I was there, the newsroom was downsized to less than 25%of what it was when I was hired.” The company newspapers had become,”shoppers with unoriginal content...(and)..the laughingstock of the community.”
            “Profits over people legacy; worst company on the planet,” is the headline over another negative Glassdoor post.
            “This corporation is run by Melanie Radler, a ‘lawyer’ and daughter of David Radler who knows absolutely nothing about how newspapers work these days.” The post goes on to mention David Radler’s fraud conviction.
            “A horrible, stressful working environment, especially in upper management. Corporate micro manages everything. The pay is insulting.”
            The post says the company is “stuck in 1970s journalism,” and in a category of advice to management, “Pay your employees what their (sic) worth. Focus on proper journalism so that communities TRUST the paper.”
            All 17 reviews identified as by former or present company employees were negative. 
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