In Chicago, as post-Independence Day week unfolds, the countdown to the bedrock event in the Chicago Sun-Times' future begins.
While most cities' last-standing largest dailies have a hard time telling you how they plan to be big and strong a decade from now, the second daily in America's Third City must look at that question in months. Losing more than $300,000 a month, the Sun-Times must find new ownership willing to both keep it operating and to find a new future.
And it must do quickly. Sun-Times owner Wrapports LLC rattled the cages a bit Friday, letting it be known that it would shut down the paper absent a deal. That's not new news; it was the Wrapports board decision at the beginning of 2017 not to further cover Sun-Times losses that led to this crunch point. Consider the Wrapports threat an effort to sweeten a very thin offer; the company may be offered as little as a token dollar for the takeover of the ailing Sun-Times.
In any event, expect a wrap on the Sun-Times' transition soon. The Department of Justice's Antitrust Division had set a deadline of Monday for an agreed deal. All the parties in this mini-newspaper drama -- Wrapports; longtime rival Chicago Tribune and its publisher, Tronc Inc. (TRNC) ; the DOJ's Antitrust Division and the emergent local business/labor Eisendrath group newly impassioned about saving the Sun-Times -- remain publicly mum on the details of the transaction.
Today, then, could see an agreement and possibly a move to put money into escrow, with details finalized later this week.
Throughout this months-old sales process, certainty or at least reducing uncertainty has been the name of this game.
How best to assure a more certain Sun-Times future will drive the decision-making? There's the old saw about death and taxes, and until last fall, the futility of the Chicago Cubs, but it's more certain survival that remains the key goal of the prominent nonbusiness player in this game, the DOJ.
The DOJ, after computing a liquidation value for the struggling Sun-Times and looking at its red run rate, has come up with one compelling number: $11.2 million. That's the minimum capital requirement it has set for the group headed by Eisendrath.
Sources said Eisendrath's Chicago Federation of Labor-backed group of local investors looks like it has raised commitments for about that sum, but likely for not much more yet, though it has intended to raise a $15 million pool. Sources said the offer to Wrapports is a single dollar, more or less, a number I suggested recently is a fair valuation for the money-losing enterprise.
The buying theory: The money-losing publication is without financial value on the open market, valuable only to Tronc in the short term given its printing contract and ability to whack costs. Further, the buyers would say that the Wrapports sellers -- who espoused civic beliefs in buying the paper six years ago -- should be glad to turn it over to new owners who will plunk new money into resuscitating the once-proud alternative to the Chicago Tribune. It's a pitch to civic pride -- with the hammer of the DOJ hanging above.