Los Angeles Times Media Group takes step to go public

The Los Angeles Times Media Group, which includes the 144-year-old newspaper, a digital production studio and a gaming company, is moving forward to make shares in the combined entity available to the public, the company announced Thursday.

The company plans a round of private placement financing aimed at attracting large investors, private equity groups and institutions. The move will be followed by a Regulation A offering, which will make shares available on the New York Stock Exchange, where it will be listed under the ticker symbol of LAT.

Dr. Patrick Soon-Shiong, chairman and chief executive of Los Angeles Times Media Group, said in an interview that he is looking to raise up to $500 million to build the company into a financially sustainable operation with the newspaper’s journalism at its core.

The private placement offering will consist of Series A preferred stock that carries a 7% annual interest rate and is convertible into common stock at a 25% discount of the potential price of shares offered to the public. Accredited investors can invest as little as $5,000.

Digital Offering LLC is the placement agent for the offering. Details are on a dedicated website: Join.LATimes.com.

The Securities and Exchange Commission defines accredited investors in a Regulation A offering as individuals with a net worth of $1 million, excluding their primary residence or annual income of more than $200,000 in the last two years. The threshold is $300,000 with a spouse.

The newly named Los Angeles Times Media Group will integrate the newspaper and its digital operations with Soon-Shiong’s NantGames, a San Diego-based company involved in interactive gaming and esports; and LA Times Studios, which creates content for podcasting and streaming, and stages live events. LATMG will also include NantStudios, a digital studio that provides services for video and film production.

The company said in a statement that the four units will operate under “one unified content management and streaming platform, designed to accelerate premium content, live events, and community engagement.”

In an interview, Soon-Shiong acknowledged the Los Angeles Times has faced significant financial losses in recent years, but said the combined operation of LATMG as proposed in the offering is currently close to break-even.

“We are now at a place of efficiency,” he said.

Soon-Shiong said he will not entertain offers to acquire the Los Angeles Times operations.

“We committed as a family to support and maintain the integrity of the whole newsroom together with activating this platform so we can engage with a broader global audience,” he said.

Like other legacy media businesses, the Los Angeles Times has been challenged by declining subscription and advertising revenue as readers have moved away from their newspaper habit in favor of digital platforms.

The average weekly print circulation for the newspaper is about 100,000, while direct paid digital subscriptions are 243,000, substantially below national competitors such as the New York Times and the Wall Street Journal. A total of 500,000 paying customers access L.A. Times content across all digital platforms.

As the company struggles with declining revenue, the Los Angeles Times newsroom has endured several rounds of layoffs, including a more than 20% staff reduction in 2024.

The staff represented by the Los Angeles Times Guild has been in negotiations for a new contract for three years. On Thursday, the guild announced its membership has authorized leadership to call for a strike by an 85% margin.

“These negotiations have dragged on for far too long, and today’s vote results show that our members are fed up,” Matt Hamilton, chair of the L.A. Times Guild and an investigative reporter, said in a statement. “Now is the time for management to come to the table with a proposal that is truly fair for our members and helps restore The Times.”

Before the strike authorization vote was announced, Soon-Shiong said management is in “constant communication” with the guild and did not believe the lack of a contract will concern potential investors.

“This is a business and not a philanthropic exercise,” Soon-Shiong said.

Soon-Shiong was not available to comment on the strike authorization vote, which was announced after the interview.

In 2018, Soon-Shiong purchased the L.A. Times, the San Diego Union-Tribune and several community newspapers in a $500-million deal. His investment in the paper has since grown to more than $750 million.

The sale returned The Times to local control after a turbulent 18 years of ownership by Chicago-based Tronc. In 2023, he sold the San Diego Union-Tribune to MediaNews Group.

Soon-Shiong built his fortune through pioneering pharmaceutical and biotech ventures, including cancer treatments.