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Tronc to sell Los Angeles Times, other titles to Nant Capital

Tronc Inc. agreed to sell the Los Angeles Times, The San Diego Union-Tribune and other titles in the California News Group to Nant Capital LLC, a private investment vehicle of California-based entrepreneur Patrick Soon-Shiong, for $500 million in cash plus the assumption of $90 million in pension liabilities.

Also, tronc is launching a national digital growth strategy through its Tribune Interactive division, which will operate the digital functions of the company, as well as pursue strategic growth investments and acquisitions.

The California News Group portfolio being divested represented about $470 million in net revenues for the 12-month period ending Sept. 30, 2017, and about $73 million of EBITDA, including the corporate cost allocation associated with the portfolio, the company said Feb. 7.

Under the transaction, tronc will also transfer all operational liabilities associated with the Times, The San Diego Union-Tribune and other related community-based publications and $90 million in pension liabilities in connection with the transaction. There will be a customary transition services agreement to ensure a seamless transition of ownership and operations. The company plans to use after-tax cash proceeds to repay all currently outstanding corporate debt. Post-transaction, tronc is expected to have a significant cash balance that will allow for the company to pursue a continued push into buying complementary digital properties.

The transaction is expected to close in the late first quarter or early second quarter of 2018, subject to antitrust clearance under the Hart-Scott-Rodino Act and other customary conditions. The transaction has been approved by the tronc board. Financing and shareholder approval are not conditions to close.

According to a separate news release, tronc acquired a majority ownership stake in BestReviews, the high-growth online product review company based in San Francisco and Reno, Nev. BestReviews' current owners will retain a minority ownership stake and continue to oversee and manage all operations.

Also, Tribune Interactive will house the company's digital assets and functions, the studios unit, national digital sales and digital corporate and business development. The unit will also include syndication unit TCA and the recently acquired The Daily Meal.

Newly reinstated executive Ross Levinsohn will lead Tribune Interactive as CEO. Mickie Rosen will serve as president and Lewis D'Vorkin as chief content officer. Ben Gerst will serve as chief technology officer, Mark Campbell will oversee digital subscriptions and marketing and Rob Angel will be in charge of corporate and business development. Tribune Interactive will be based in Chicago, with offices in New York and Los Angeles.

Kirkland & Ellis LLP is acting as legal adviser to tronc. Fried Frank Harris Shriver & Jacobson LLP is acting as legal adviser to Nant Capital.