Media Moguls Bid for JPost As Israel’s Anglo Voice Is Put on Auction Block

By Nathaniel Popper

Published May 28, 2004, issue of May 28, 2004.
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When the May 20 deadline passed for bidders seeking to buy the Jerusalem Post, Israel’s most famous English-language newspaper faced a welter of suitors offering strikingly different visions of the future.

A leading contender who has all but confirmed his entry into the secret auction — Canadian media mogul Leonard Asper — has a reputation for using a strong editorial hand to position his papers steadfastly, sometimes controversially so, behind a hawkish view of Israel.

The other apparent front-runner, Hollywood producer Haim Saban, has been friendly with many figures in the Israel Labor Party and gave the single largest donation ever to the Democratic Party in the United States.

Sources close to the Jewish Chronicle, a centrist, independent weekly in London, said that paper still was planning to submit a bid with financial backers that may include Saban or Asper. There is also talk that the Jerusalem Post’s current publisher, Tom Rose, may be assembling an offer of his own for the paper.

The Post was put up for sale along with the rest of the papers owned by Hollinger International, including The Daily Telegraph of London, and the Chicago Sun-Times, after Hollinger executive Conrad Black and his deputy at the Jerusalem Post, David Radler, were accused by the company’s board of accepting improper “noncompete payments.”

The payments that landed the Hollinger executives in such trouble came from Asper’s media company, CanWest, after CanWest bought 13 Canadian newspapers from Hollinger in 2000.

The auctioning process set off by the resignation of Black and Radler has been dominated by secrecy and confusion, as bidders have ducked in and out of the race, leading to wildly divergent news reports about the process. Hollinger representatives have insisted that the company may not sell any of its assets, though the Jerusalem Post — the “odd duck” of the Hollinger family, as one observer described it — is likely to be the first that would go.

All the bidders for the Hollinger properties were required to sign a confidentiality agreement, and the only bidder for the Post to confirm his bid explicitly was Norbert Aleman, a real estate magnate and producer of adult entertainment in Las Vegas, who said he has teamed up with Shmuel Flatto-Sharon – an Israeli businessman and onetime lawmaker with a storied past in jewelry sales and jail time.

It was originally thought that buyers interested in all Hollinger’s properties would have a leg up in the bidding. But a company spokeswoman now has said that the sale of Hollinger as a block would require the complicated intermediate step of winning Black’s approval, while the sale of individual papers would not.

This has opened the contest for the Jerusalem Post, with its $20-40 million price tag, to Jewish buyers who are interested in Israel but lack the resources or the interest in the entire Hollinger group. Still, some of the leading names in this group have already fallen out of the contest. Mortimer Zuckerman, the publisher of the New York Daily News, who frequently has been mentioned in discussions of the Post’s future, told the Forward through an assistant that he is not submitting a bid.

Saban, an Israeli-born filmmaker best known for his “Mighty Morphin’ Power Rangers” children’s series, had been involved in a joint bid for all the Hollinger properties with the German publishing house Axel Springer. That team appears to have fallen apart, however, leaving Saban free to tender an individual offer for the Jerusalem Post.

Hollinger also owns less than 10% of the New York Sun, which cannot be sold individually like the Jerusalem Post. If a bidder purchases the entire Hollinger properties, they would acquire this stake in the Sun, but that is an unlikely scenario right now.

The auction process for the Post has turned up a colorful and varied group of bidders, but Calev Ben-David, the Post’s managing editor, said that for Post employees, the background of the new owners is less important than the speed with which they buy the paper.

“Our main concern is having an owner — one who will bring out the paper’s profit potential, which is there,” said Ben-David, making reference to the Post’s notoriously difficult time turning a profit since Black bought the paper in 1989. “We’re people who want to make a living, and we’re tied to a company that’s having a lot of problems.”

Asper appears to be in the best position to take over quickly. Post employees confirmed that CanWest representatives are the only ones to have visited with the editorial staff at the Post. But Asper, in a television interview two days before the bidding, said that it was likely he would bid for the paper with his personal assets rather than with those of CanWest.

If Asper’s bid succeeds, employees of the Jerusalem Post may travel a route already followed by many Canadian journalists at the 13 CanWest newspaper titles purchased from Black in 2000.

Like Black before them, the Aspers have become known in Canada for their strenuous cost-cutting measures, which have not made many friends among the journalism unions for either Hollinger or CanWest.

Gillian Steward, managing editor at the Calgary Herald until Black bought the paper, said that the Aspers are “just as focused on the bottom line and squeezing profit out of their properties.”

On the editorial side, Canadian media observers say the Aspers are known to be even more controlling than Black. CanWest raised the hackles of many in the Canadian journalist community when, in 2001, the company began distributing editorials for all its subsidiary newspapers from its head office in Winnipeg.

Much of the debate surrounding the Aspers has stemmed from their ardent editorial defense of Israel, which likely would be less controversial in Jerusalem than it has been in Canada. Given the Jerusalem Post’s struggling finances in recent years, many observers say the paper would be unlikely to attract a buyer who was not drawn by a strong interest in the editorial message and content of the Post.

Saban has much less experience in news media ownership. He purchased his first journalism property last year — the German television network ProSieben Sat.1. He quickly developed his own reputation for an insistence on pro-Israel coverage with a speech before British media owners last fall, though his Labor-oriented politics go in a very different direction than Asper’s.

Observers say that among the top bidders, London’s Jewish Chronicle has the least pre-defined editorial position. That too could represent a change for the Post, given its current aggressive editorial positioning.

“I think the Chronicle would not support the right-wing parties,” said Lord Greville Janner, a onetime lawmaker and former Chronicle board member. “My guess is that it would be independent.”

The financing for the Chronicle’s bid remains unclear. Aleman, the Las Vegas businessman, claimed his group of investors is working with the London paper, though an editor at the Chronicle said it was unaware of Aleman’s consortium.

Some observers of the auction have questioned the seriousness of the bid from Aleman’s team. Aleman told the Forward, “We’d love to get the paper, but if we don’t, life goes on.”

For other potential bidders, the lure of the Post appears to have slightly greater emotional and political implications. But a Hollinger spokeswoman said that at the end of the process, the decision to sell the paper — if it is made at all — will be based not on ideology, but on the financial interests of the Hollinger shareholders.






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