New MaineToday Investors Bring Baggage
Secret plans and sacks of cash: On Jan. 6, MaineToday Media – owner of the Portland Press Herald, Kennebec Journal and Morning Sentinel – announced that a group of investors called the 2100 Trust LLC was buying a majority share of the struggling company. It’s not known how much money the trust is sinking into MaineToday, but according to reporting by Matt Wickenheiser in the Bangor Daily News, the business that MTM hired to help it restructure financially was seeking $15 million in new investments, with $10 million earmarked for retiring existing debt and the rest for new operating capital.
MaineToday has refused to reveal how much of the company 2100 Trust is buying, but other sources say it will be the dominant member of the ownership group, with previous majority owner HM Capital of Dallas, Texas, relegated to a relatively minor role. It’s not clear how the arrival of new investors will affect other minority owners, including ousted CEO Richard Connor and local developer Robert C.S. Monks.
The deal is expected to close in about a month.
The driving force behind 2100 Trust is Aaron Kushner, 38, a Massachusetts businessman whose only previous involvement with the news media occurred in 2010, when he announced he’d formed a group to buy the parent company of the Boston Globe. According to a February 2010 Boston Magazine article by Katherine Ozment, Kushner made big bucks in 1999 selling a dot-com company he’d started. He then invested in Marian Heath, a small Bay State greeting card company. As part of his ambitious effort to make that operation a major player in the industry, he began buying up other card companies, including his 2005 purchase of Renaissance Greeting Cards in Sanford, a move that resulted in nearly half the staff being fired. Kushner later had a falling out with his partners and is no longer directly involved in Marian Heath.
He next surfaced in 2010 with an audacious plan to buy the Globe. According to Ozment, “He insists he’s come up with a formula — the details of which he won’t reveal — to return the Globe and its sister paper, the Worcester Telegram & Gazette, to their days of glory. This plan, one of his investment partners believes, may even revolutionize the entire newspaper industry.”
Immediately after Kushner announced his move to take over MaineToday, he confirmed he’s still trying to buy the Globe, a property for which he’s offered $200 million according to published reports. But other articles indicated the New York Times was no longer interested in selling the Boston paper to him or anyone else.
In interviews, Kushner has said his proposal for returning newspapers to profitability calls for investments in the newsroom, rather than more layoffs. “Our plan is a very contrarian plan,” he told Boston Magazine. “If you want to grow a business, you have to invest in that business; especially when it is at a weak point, you cannot cut your way to growth.”
One person who’s seen Kushner complete plan is Chris Harte, his partner in 2100 Trust. Harte is a former president of the Portland Press Herald (1992-1994) and more recently the publisher of the Minneapolis Star Tribune, having guided that paper into and out of bankruptcy. Harte told Boston Magazine he was initially skeptical, but eventually came to believe in Kushner’s vision. “There’s nobody that I’m aware of who’s got as innovative a plan and as good an understanding of some possible solutions that I think will be seen later as among the foundations for most newspapers going forward,” Harte said.
Harte brings significant financial resources to the trust – he’s an heir of the Harte-Hanks publishing fortune and still sits on the board of the direct marketing and advertising agency it has morphed into. He’s also a significant investor in Current Publishing, which puts out several weeklies in Cumberland and York counties. (Disclosure: My weekly political column runs in some Current papers.)
Harte has already said he won’t be the CEO of a reorganized MTM, but does have a candidate for the job picked out.
The third major player in 2100 Trust is Jack Griffin, a controversial figure in the publishing industry. Griffin served briefly as CEO of Time Inc., but was fired and publicly reprimanded for a management style that antagonized his staff and for injecting his religious views into business meetings. He now runs a consulting business.
Other names associated with Kushner include former Globe executives Benjamin and Stephen Taylor, as well as Brendan Burns, the ex-CEO of an online classified ad company. It’s not clear if any of them is involved in the MaineToday deal.
Here comes the weekend: The Maine State Housing Authority waited until late on Friday, Jan. 6 to release its long-awaited report on the housing inspection problems that have plagued some apartment units in Norway. As usual, most of the news media had called it a week by then, so the only report on the document was a posting on the Maine Wire, the conservative website that’s been cheerleading for critics of the housing authority.
This could have been a golden opportunity for the right-wing site to shine by producing a comprehensive analysis of the report, while keeping the editorializing to a minimum. Instead, the Maine Wire ran a brief piece (with no byline) citing one paragraph in the document and posted the rest for those with time on their hands and little on their weekend calendars to read for themselves.
Still, it was more than anybody else did.
The MaineToday papers got around to the story on Jan. 8 in a Bill Nemitz column that was as slanted in the authority’s favor as the Maine Wire’s coverage was in the opposite direction. No news story at all.
The Bangor Daily News managed an article on Jan. 9, but didn’t appear to think the matter was of much importance. It buried the piece on page two of the second section.
To date, no journalist has matched the superb initial reporting on this story done by the staff of the Advertiser Democrat in Norway, a news outlet where it’s obvious they aren’t always as inclined as their big-city counterparts to take weekends off.
Pot shot: Speaking of good work, check out staff writer Michael Shepherd’s excellent piece in the Jan. 9 Morning Sentinel on the problems at the Wellness Connection of Maine’s medical marijuana operation. The operators of these clinics and growing facilities have been closed mouthed about what appear to be mounting problems with their business plan, but Shepherd was able to get around much of the stonewalling.
Real news on a Monday morning. Shocking.
Faces (and voices) from the past: According to Radio-Info.com’s northern New England message board, three local TV news veterans have teamed up to do radio talk. Patsy Wiggins, Susan Kimball and Peggy Keyser are hosting a topical show on Saturday afternoons on WLOB (1310 AM) in Portland.
Meanwhile, ex-WGME-TV anchor Kiley Bennett, who abruptly left Channel 13 in 2010, is said to be appearing in ads for Electricity Maine.
Al Diamon can be emailed at firstname.lastname@example.org.