Taylor signs Star Tribune purchase dealPublished 10:03am Thursday, May 29, 2014
By Adam Belz and Rochelle Olson
Glen Taylor’s effort to purchase the Star Tribune moved forward Wednesday with the signing of a purchase agreement between the Minnesota billionaire and the media company.
Star Tribune Publisher Mike Klingensmith called the agreement an “important milestone” and said he expects the sale to close around June 30.
“Work remains to be done, but we are increasingly confident of closing this transaction,” Klingensmith said.
The Star Tribune, the state’s largest media company, would join Taylor’s portfolio of more than 80 businesses worldwide. They include the Minnesota Timberwolves and dozens of companies in printing and other industries.
Taylor has said he will pay around $100 million in the deal. He could not be reached for comment Wednesday. Klingensmith declined to discuss details of the agreement, other than to say that they haven’t changed since both parties signed a letter of intent for a possible purchase almost two months ago.
“That’s significant,” Klingensmith said, “because as [Taylor’s representatives] go through due diligence, they thoroughly review our financials and look at our records and our contracts.”
At this point, Klingensmith added, the only thing that could sink the deal is a “material adverse change.”
The largest shareholders in the Star Tribune are Wayzata Investment Partners and GE Capital, which together own about 75 percent of the shares. The rest of the stock is owned by several dozen former creditors and other investors. Taylor’s offer is for 100 percent of the shares.
The sale would be a pivotal moment for the Star Tribune, which emerged from bankruptcy in 2009 with the challenge of reinventing itself for a digital audience while also publishing a strong print edition. Since then, the company has expanded its readership and stabilized its finances. The newspaper won two Pulitzer Prizes in 2013.
The company also has reduced a significant amount of debt, partly through the recent $38.5 million sale of five blocks it had owned in downtown Minneapolis. The land sale cleared the way for a $400 million office tower project near the new Vikings stadium, which is under construction.
Taylor, 73, has said he will not take a managing role with the Star Tribune, although he might put a family member on its board of directors. The company’s current management would remain in place.
Joel Kramer, a former publisher of the Star Tribune who is now the CEO and editor of MinnPost, said he was optimistic about the purchase because Taylor is a “local owner with deep pockets” who wants to retain Klingensmith.