Wednesday, May 23, 2012

Wrapports buys the Reader

Posted By on 05.23.12 at 10:46 AM

Jim Kirk
  • Jim Kirk
Wrapports LLC, the collection of high-flying investors who own the Sun-Times and Sun-Times Media, have added the Reader to their stable, buying this 41-year-old weekly–which the Wrapports news release chooses to call “iconic”—for slightly under $3 million. The deal was closed Tuesday and announced Wednesday morning.

The Wrapports news release has CEO Timothy Knight calling the Reader “one of the most distinctive voices in the Chicago news community.” It has Brad Bulkley, the Dallas investment banker who brokered the sale for Atalaya Capital Management, pleased “to have been able to place this highly regarded Chicago institution into such capable hands.” In 2007 the Reader was sold by its founders to Creative Loafing Inc., which declared bankruptcy a year later. CLI emerged from bankruptcy in 2009 with Atalaya controlling it. “Fortunately, Atalaya gave us the flexibility to identify the ideal successor,” Bulkley continues.

The acquisition gives advertisers access to a type of affluent, urban reader they could reach through no other Sun-Times Media paper. And it gives Sun-Times Media papers access to Reader content such as listings and reviews. The Reader will benefit, presumably, from the new owners’ deep pockets, entrepreneurial savvy, and unbridled ambition. “These guys really want to win,” Jim Kirk, the new editor in chief of Sun-Times Media, told me. “And they want to win quickly. So they’re moving fast.”

The idea that the Reader would end up as a piece of Sun-Times Media shocked this paper’s staff when the possibility of it was first reported by Crain’s Chicago Business in early March. If the concept of an alternative newspaper means anything at all four decades after the Reader was founded, it means that the employees of one define themselves by what they’re not–they’re not churning out stories for an old-line daily newspaper. And in the case of Wrapports, the daily paper was its dolefully diminished flagship, the Sun-Times, a troubling advertisement for the company.

But as time passed and no more attractive suitors emerged, the Reader staff began to accept the inevitable. For all its alternative airs, the Reader culture is deeply old school, and it helped matters that a month ago technology entrepreneur Michael Ferro, chairman of Wrapports, hired Kirk, one of Chicago’s best-credentialed old-school journalists, to be editor in chief of Sun-Times Media. After rising to business editor of the Tribune, Kirk made stops at Bloomberg News, the Chicago News Cooperative, and Crain’s Chicago Business before joining Wrapports. It also helped that Bulkley told me other suitors wanted to buy the Reader to kill it.

And as the Reader’s publisher, Alison Draper, and editor, Mara Shalhoup, got to know the Wrapports leadership, they spoke well of it. Draper, who’ll continue as publisher until June 30, searched independently for a new owner when it became clear that Atalaya was eager to unload the Reader, and she tells me she had very specific criteria: she wanted a local owner who understood the Reader and respected its legacy, was digital savvy, had deep pockets, and was ready to make a serious investment in the paper.

“I had every reason to be skeptical,” she tells me. Yet the new owners “meet every one of those criteria.”

Shalhoup, who’ll continue as editor, says she’s “very encouraged” to have Kirk as the boss she reports to—and for a couple of compelling reasons. The first is what she’s heard from people who have worked for him and with him. The second is his success in transforming the digital presence of Crain’s Chicago Business. She explains that she came here early last year eager to understand Chicago by reading everything about it she could get her hands on, and the Crain’s website simply imposed itself on her. “It came into my world without my actively seeking it out,” she says. “Crain’s changed from once-a-week to daily importance.” She welcomes a boss who not only gets that process but has succeeded at it.

But while all this is reassuring, some recent Wrapports developments are not. Time Out Chicago blogger Robert Feder reported a couple of days ago that John Barron, executive editor of the Sun-Times, was offered the job of Reader publisher and turned it down. Neither Knight nor Kirk will comment on this head-scratching invitation. Then Feder reported that the position of features editor Amanda Barrett was eliminated at the Sun-Times and Jeff Wisser was fired as editor in chief of the Pioneer Press papers. These were big decisions for Kirk to make after just a few days on the job–if he made them.

They were my calls, Kirk told me Wednesday morning.

The Reader’s lease at 11 East Illinois, a building it used to own, runs into 2014, when this paper is likely to move into Sun-Times Media space at 350 N. Orleans. The sooner the better, said Draper. “The culture feels real good there. I’d want to be there,” she said.

It seems Ferro has made some changes. The last I’d heard about Sun-Times amenities, David Radler, the publisher who’d later go to prison, was turning off the escalator to save a few pennies in electricity at the old building on Wabash. Kirk told me Ferro “is trying to infuse a little bit of that entrepreneurial feel to the place.” As Knight put it, “ We’re not an old-fashioned newspaper company. We’re much more like a start-up.”

A digitally focused start-up at that, with the benefits common to the species. So Draper gave me an earful about the new dining room with free Starbucks coffee, a refrigerator stuffed with fresh fruits and vegetables, an ice cream case, and an arcade room with a pool table and games.

That wasn’t all. Their bathrooms are heated. It turns out the women’s room here isn’t. It’s miserable.

Who knew? I guess half the staff knew.

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