As Los Angeles newspaper folds, philanthropist seeks to turn San Diego newspaper non-profit

SAN DIEGO—An octogenarian philanthropist launched a bid to buy San Diego’s dominant newspaper and turn it into one of the nation’s largest non-profit news organizations, while another major Southern California publisher shut its short-lived Los Angeles newspaper.

Malin Burnham, a prominent San Diego businessman with a background in commercial real estate and insurance, said Douglas Manchester, the current owner of U-T San Diego, has encouraged him to seek non-profit status from the Internal Revenue Service, which may take about 90 days.

Burnham, 86, said he and Manchester exchanged proposed prices and that he believes his offer can be “in the ballpark.” He declined to be more specific.

Manchester would remain owner of the U-T San Diego headquarters building and lease offices to the newspaper, Burnham told The Associated Press.

Manchester, also a prominent San Diego businessman, who bought the newspaper in 2011, said he was ready to talk with Burnham after he gets non-profit status but that a deal was long way from being completed.

“I have always admired and respected all that Malin has done for our community and continues to do,” Manchester wrote in a brief statement in response to a list of questions.

News of the bid came as Freedom Communications Inc. announced it was closing the Los Angeles Register only five months after launching it as a challenger to the Los Angeles Times. Freedom also said it sold the Santa Ana headquarters building of its flagship newspaper, the Orange County Register, for $27 million and will lease space there.

The Los Angeles Register’s demise was another setback for owners Aaron Kushner and Eric Spitz, who bought Freedom in 2012 and vastly expanded staff with a contrarian, print-centric strategy that has yet to win followers in the industry.

Freedom said it will focus on markets in Orange, Riverside and San Bernardino counties. It owns the Riverside Press-Enterprise, which it bought in November for more than $27 million.

A memo to employees from Kushner and Spitz on Monday night said there will be “staff changes,” but it did not give specifics or mention layoffs.

“Pundits and local competitors who have closely followed our entry into Los Angeles will be quick to criticize our decision to launch a new newspaper and they will say that we failed,” they wrote. “We believe the true definition of failure is not taking bold steps toward growth.”

In San Diego, Burnham is quick to say he is new to the news business and has no easy answers for a struggling industry, though he said the migration of readers online will greatly reduce costs. He said he could see reducing daily print editions in two to five years and going to a Sunday-only print edition in 10 years.

“Nobody is predicting there will be less news in the world,” Burnham said. “We believe the delivery of news is a long-term prospect.”