After Bitter Dispute, Newspaper Changes Hands

New York Times/August 1, 2002
By Felicity Barringer

The Salt Lake Tribune is noting the final phase of its bitterly disputed ownership transition with an editorial in today's editions that promises that "the newspaper will serve all of Utah and be beholden to no one." A federal appeals court on Tuesday rejected an effort by the newspaper's former owners to retain control of the publication.

The final transition, by which MediaNews group is taking control of The Tribune 19 months after it paid $200 million for the paper's parent company, comes after two years of contentious legal struggles.

The bitterness of the fight was aggravated by the suspicions of Salt Lake City's non-Mormon community - including the newspaper's former owners - that the Church of Jesus Christ of Latter-day Saints would use the new owners to exert control over the proudly non-Mormon newspaper, which was founded more than 130 years ago by Mormon dissidents.

Salt Lake's population is split almost equally between Mormons and non-Mormons, but the church is the dominant cultural, political and economic force in the city. The other daily newspaper in town, The Deseret News, is owned by the church.

The newspapers participate in a joint operating agreement, sharing business functions like advertising and distribution. This relationship has been bitter, with the professional managers of the two sides feuding over business issues. The feud was spiced with the fears of Tribune managers and supporters that the church wanted to control - and perhaps silence - the loudest non-Mormon voice in town.

The fact that the church encouraged the MediaNews takeover while fighting the former owner's effort to rebuy the newspaper confirmed the suspicions of many local non-Mormons that the paper they regarded as their own was effectively subject to a hostile takeover.

The former owners sold the newspaper's parent company, Kearns-Tribune, to the cable giant Tele-Communications Inc. in 1997, in a $731 million deal intended to reap the gains from a massive appreciation of TCI stock that was owned by Kearns-Tribune. As part of the deal, the heirs of Senator Thomas Kearns, who bought the newspaper in 1901, secured an option to buy it back.

TCI was bought by AT&T, whose executives were sick of the local feud and nervous about irritating the church just when they were trying to sell cable subscriptions in Utah. In 1999, AT&T explored selling The Tribune to The News. When that sale proved unfeasible, AT&T executives eventually settled on a price with MediaNews, whose flagship newspaper is The Denver Post.

The circumstances of the sale fed local suspicions that Dean Singleton, the head of MediaNews, was a stalking horse for church interests. During three days of meetings with The Tribune's 144 journalists and with civic leaders this week, Mr. Singleton said he met with wary questions about how close his ties were to the church. (He is a Baptist, and has served on an advisory board for Brigham Young University.)

Philip McCarthey, the Kearns heir who apparently is the loser in the fight for control, still insists he has a right to buy back the newspaper. Mr. McCarthey said yesterday that he felt "angry and betrayed" by everyone from the AT&T executive who pushed for the sale to The Tribune's editor, James E. Shelledy, who has agreed to continue in the job.

The Tribune, published in the morning, has a daily circulation of about 143,000; the afternoon News has a daily circulation of 88,000.