Two of Chicago’s best-known media brands are tying the knot as WBEZ’s board of directors voted unanimously Tuesday to acquire the Chicago Sun-Times.
The deal is expected to close Jan. 31, Chicago Public Media and the Chicago Sun-Times said in a joint statement.
The acquisition would create a new journalistic powerhouse, pairing the city’s award-winning, top-rated morning news station with the gritty tabloid made famous by its corruption-busting investigations, Roger Ebert’s movie reviews and Irv Kupcinet’s gossip column, and crisp sportswriting.
“This is an important step to grow and strengthen local journalism in Chicago,” said Matt Moog, CEO of Chicago Public Media in a statement.
“A vibrant local news ecosystem is fundamental to a healthy democracy, informed citizens, and engaged communities. Together WBEZ and the Chicago Sun-Times aim to tell the stories that matter, serve more Chicagoans with our unbiased, fact-based journalism, and connect Chicagoans more deeply to each other and to their communities,” Moog said.
The closely-watched deal is being held up as a possible template for other impoverished news organizations whose newsrooms have been gutted by declining advertising revenues, audiences migrating to social media for their news and disinterested media owners unwilling to invest.
According to the two organizations, the Sun-Times would join WBEZ as a not-for-profit subsidiary of Chicago Public Media.
The Chicago Sun-Times would get its own non-profit board, with Moog getting a seat, as well as current CPM board directors Adrienne King of Bain & Company and Lerry Knox of Sovereign Infrastructure Group. The board would also include Kristen Mack of the John D. and Catherine T. MacArthur Foundation and Aretae Ortiz Wyler, who is the chief operating officer of The Atlantic, as independent board members.
Both WBEZ and the Sun-Times would maintain their own newsrooms, own staff, and own “editorial independence,” according to the organizations. Nykia Wright would remain the CEO of the Sun-Times, but report to Moog. Both newsrooms would also hire executive editors, positions that do not exist at either organization. (The Sun-Times has an interim editor-in-chief, Steve Warmbir.)
The deal gained steam last fall, when the paper’s lead investor, Michael Sacks, and several prominent foundations stepped up with offers to help underwrite the acquisition, and WBEZ’s board voted in September to explore a pairing of the two organizations.
Sacks, chief executive officer of Chicago-based Grosvenor Capital Management, is putting money into the new organization, as are the John D. and Catherine T. MacArthur Foundation and the Pritzker Traubert Foundation. Sacks will not have a role in the governance of Chicago Public Media or its Sun-Times subsidiary.
As one of the largest foundations in the country, Chicago-based MacArthur has an $8.2 billion investment portfolio as of 2020 and has been a leading backer of public media and other journalistic endeavors. Pritzker Traubert is chaired by Bryan Traubert, a longtime Chicago Public Media board member and husband of former Commerce Secretary Penny Pritzker.
Moog and Wright declined to attach a dollar figure to the overall transaction or disclose the specific financial contributions.
Under the deal, the Sun-Times, whose solvency was questioned for decades such that it once turned off the escalators in its downtown offices to save money, would get a new, long-term financial lease on life, and WBEZ would capitalize on the newspaper’s larger digital and print presence.
“For the Sun-Times, it actually means longevity,” Wright said of the deal. “When we think about the most prominent news organizations, most people naturally think about the coasts, and this gives the Midwest, specifically Chicago, an opportunity to show that news can be strong in local communities.”
She said the trendline toward profitability has been “getting much stronger,” particularly since a money-draining printing contract with the Chicago Tribune was renegotiated last year with terms more favorable to the Sun-Times. She said she foresees no reason under current terms to terminate the Tribune contract.
While Wright would not divulge specifics about the Sun-Times’ precise fiscal condition, she said the newspaper presented worst-case funding scenarios to WBEZ’s board, and the results didn’t sour the deal.
“I think that was the biggest part of the due diligence process, looking at the financials many different ways, many different modeling assumptions, and even with, I would say, the worst case assumptions, there was still positive feedback for how we can continue to not be a strain on the parent company,” she said.
While both organizations would be run independently, Moog said they expected to share content across the radio airwaves, online and even still on tens of thousands of doorsteps. Together, WBEZ and the Sun-Times figure to reach a news audience estimated to reach 2 million per week, making it one of the most formidable media platforms in the city.
“It certainly will be one of the largest,” Moog said. “The most important thing…is this is less of a competitive situation and more of a cooperative one. We intend to work hand-in-hand with both independent media organizations and other larger ones to make sure that we’re providing the best possible information to as many people as we can across the Chicagoland area.”
The Sun-Times will maintain its offices in the West Loop, and WBEZ will remain headquartered at Navy Pier.
Their respective newsrooms will also be represented by different labor unions with the Sun-Times aligned with the Chicago News Guild and WBEZ with SAG-AFTRA. Both unions are entering contract negotiations this year. Moog would not say how different pay and benefits across both newsrooms would be reconciled.
“There’s no expected changes to pay and benefits than what they have today,” he said.
As they have since talks about a merger became known, Moog and Wright both committed against layoffs, but Moog could not offer a timeline when asked how long a no-layoff pledge would remain in effect.
“What we said many times is we don’t have any plans for any kind of layoffs. None of us can see all the way into the future and know exactly what’s going to happen,” Moog said. “But what we’ve tried to communicate very clearly is this is about growth and investment. This is not about consolidation or contraction.”
“We expect to have 50 open positions between the two organizations at the moment that we combine so we are in the position of looking to hire additional people across the organization,” he said.
A representative of WBEZ’s newsroom union, SAG-AFTRA, declined comment on Tuesday evening’s announcement, but the Chicago News Guild’s Nader Issa, a reporter and unit-co-chair, said his organization is bullish on the deal.
“We’re optimistic about this at the guild. We think the deal and the merger have promise,” he said. “We definitely will be advocating on behalf of our members to make sure this turns out as good as we hope it can. We think there’s a good opportunity here to work with WBEZ’s reporters and staff to build on the news products that we’re already putting out every day. We’re going into our negotiations this year with the same intent of bettering our workers’ conditions that we always have.”
The rollout of the deal has not been without hiccups. Moog and other leaders had previously expressed hope the merger would be finalized by the end of the year, but it was apparently delayed. Staff from both WBEZ and the Chicago Sun-Times largely learned about the potential for a deal from media columnist Robert Feder, who broke the news first. Feder was among those watchers who opined both on the hope of what the deal could bring, and the challenges of a potentially complicated merging of the two outlets to Northwestern University’s Local News Initiative.
And then on Tuesday, the special meeting at which the deal was approved was likely not known by most of the staff of the organizations — it was not listed on the WBEZ Board of Directors’ public schedule of meetings.
“These kinds of board meetings are done when the documents are finalized, which didn’t happen until very recently,” Moog said when asked about the lack of public notice.
He also declined to make available the agreement the board voted on Tuesday night, saying it wasn’t a public document.
As for how the acquisition will play out in both newsrooms, some changes are expected, including the end of editorial endorsements for the Sun-Times — as a non-profit, it won’t be allowed. Wright stressed, though, that the newspaper will retain an editorial page.
The newspaper’s existing paywall also will be softened in a way that will seek subscription support from consumers but also not block content for those unable or unwilling to pay, Moog said.
But nitty-gritty details of how the potentially massive deal will ultimately work, such as how beats will be structured for two newsrooms covering some of the same topics, will largely be left up to the individual editors overseeing the newsrooms, who will in turn get oversight from the independent boards, Moog and Wright said.
Wright emphasized in an interview however that the emphasis here is on collaboration – not competition; more news for all of Chicago.
“I think the entire time that we have discussed this acquisition, we’ve looked at this in terms of, ‘How can we get stronger ourselves and therefore strengthen the entire ecosystem?’” she said. “This is not about…competitive claws, but it’s more about strengthening the ecosystem here in the city.”
Founded in 1948 through a merger of the Chicago Sun and the Daily Times, the Sun-Times has had a long history of success – it has won eight Pulitzer Prizes – and financial struggles. Its past owners have been devoted Chicagoans, colorful profiteers and, in one instance, an outright criminal.
WBEZ has an equally rich history in Chicago.
It first went on the air in 1943 as a subsidiary of the Chicago Board of Education after school officials saw the benefit of radio as a teaching tool during a polio outbreak in the 1930s. In its early history, most of the station’s programming was oriented toward youths, and it didn’t begin establishing itself as a news station until the 1980s.
Chicago Public Media’s balance sheets have been getting stronger thanks to robust support from donors and listeners. Federal tax filings showed a $33.5 million fund balance in 2016, and in the three successive years, that total grew annually. By 2019, the most recent year for which the organization’s tax records are publicly available, the station’s fund balances stood at $50.3 million. That represented an increase of 50% over four years.
During that time, the station went on a hiring blitz and produced an array of ground-breaking and lauded investigative reports.
They focused on unjust city vehicle impoundments, gaping disparities in bank lending in Black and white city neighborhoods, and recurring Legionnaires’ disease outbreaks at a state veterans’ home in Quincy that helped drive former Gov. Bruce Rauner from office.
Other recent groundbreaking WBEZ investigations outlined Chicago Park District inaction on numerous rape and sexual harassment claims from female lifeguards, aggressive city collection efforts on unpaid water bills that hit communities of color disproportionately hard, and exclusive details and analysis about a Commonwealth Edison lobbying scandal in Springfield that led to the ouster of longtime Illinois House Speaker Michael Madigan.
Moog said he sees that kind of important work continuing under this soon-to-be completed deal, a longshot that eventually came together during a pandemic and an outright war on the truth.
“Kudos to the management team for managing through a really difficult set of circumstances with COVID and everything else. Gratitude goes out to Michael Sacks and the investors who helped transition through these difficult times,” he said.
“We’ve had major foundation step-up in a very, very significant way that gives us a very high degree of comfort that both through good management and through stewardship of these grants from foundations we’ll be able to create a sustainable source of revenue for local journalism in Chicago for the foreseeable future,” Moog said.
“That’s a really significant thing the way different stakeholders came together to preserve something that was important for the community.”
This story was previously updated to clarify that both news organizations do not have executive editors.
Dave McKinney covers Illinois politics and government for WBEZ. Follow him on Twitter @davemckinney.