Who Will Buy the Defender?/The Chronicle Chronicles | Media | Chicago Reader

News & Politics » Media

Who Will Buy the Defender?/The Chronicle Chronicles

by

Sign up for our newsletters Subscribe

comment

By Michael Miner

Who Will Buy the Defender?

If everything proceeds smoothly, Pluria Marshall Jr. expects to take over the Chicago Defender sometime this summer. "We're getting an old asset that's had a bit of neglect for some time," he says. "We'll be able to fix it in fairly short order and make it into what it was and then some."

But nothing's proceeded smoothly since John Sengstacke died four years ago, leaving the Defender and his three other newspapers in limbo. To be precise, he left 70 percent of the shares of Sengstacke Enterprises in a trust obligated to pay some $3.5 million in estate taxes. Sale of the papers became inevitable. But as the Defender hemorrhaged money, one deal after another was constructed and collapsed. Now it's Marshall's turn. He's offering about $11 million for control of Sengstacke Enterprises, and skeptics will believe he's got that kind of money when they see it.

"I hear he doesn't," says investment banker Kurt Cherry. "That's why they gave him a nonbinding letter of intent. If he had the money they'd give him an exclusive."

First to think he had a deal was Don Barden, a Detroit businessman who made his fortune in cable television. Barden and John Sengstacke's granddaughter Myiti patched together a $12 million offer that would have given Barden control of the one lucrative paper of the four, his hometown weekly the Michigan Chronicle; Myiti and her brothers would have owned 49 percent of the paper she coveted, the Defender, with her as its publisher. This highly leveraged offer was predicated on Myiti's father, Robert Sengstacke, and his cousin Tom Picou forgoing their shares of the estate to run the two other Sengstacke papers, Pittsburgh's Courier and Memphis's Tri-State Defender, as Barden's minority partners. Instead of cash, they'd get equity and assume liability. Robert Sengstacke said no to that.

When Barden disappeared, PublicMediaWorks, a company created by Cherry to buy newspapers, became the front-runner. Cherry announced a managerial team that included a couple of veterans from the Knight Ridder newspaper chain. But his lead investor backed out, and the deal fell apart.

That left, at least for the moment, only Pluria Marshall. "We kind of looked at this as that we'd probably be the last person standing," says Marshall. "It's like that old adage 'Patience is a virtue.'"

He hasn't put a single dollar down. "Why should we?" says Marshall. "Barden didn't put any down. Cherry didn't put any down." But that's why as Marshall performs due diligence, the board of Sengstacke Enterprises and the trustee of Sengstacke's estate are free to look for higher bids. You might suppose that four years after John Sengstacke's death, anyone half-interested would have spoken up long ago. But you'd be wrong.

It seems that Tom Picou now intends to enter the fray. "Probably the most seasoned person I've ever met in black newspapers," says Cherry. Is he someone you can do business with? "Absolutely," says Cherry. "I've always told him that."

Picou, who's 58, is the son of the brother of John Sengstacke's late wife. He says he started out in journalism as a teenager working in the Defender archives in the paper's subbasement. He rose to editor of the paper, then to president of Sengstacke Enterprises in the early 80s, and in 1984 left the company and moved to Florida, where he started a paper of his own. "He's a media man," says Picou, speaking of Marshall. "I'm a newspaperman."

Picou came back to Chicago a couple of years ago. Formally a consultant, he's been overseeing the Courier and the Tri-State Defender, and he claims that he's raised the Tri-State Defender's circulation from 4,000 to 38,000 by changing its format: "I integrated an alternative-newspaper concept into a standard African-American publication," he says. Meaning he did what? He says he emphasized entertainment and in-depth reporting, "but the most important thing is the design--the utilization of white space, a variety of kinds of graphics that have impact."

Marshall questions whether Picou will ever make an offer. "More power to him," says Marshall, "but I think he's been there forever, hasn't he? That's always been a rumor. It's been four years, and Mr. Picou has been there. I guess it's worth printing, but nothing's ever come of it."

Picou sounds dead serious about his intentions. So why didn't he come forward years ago? "I didn't know if I wanted to exert that much effort to bring the family company back," he says, "and I didn't know if the family would ever get together." Is it now? One important rift was between Robert Sengstacke and his daughter, who believed that when he rejected the Barden deal she lost her best chance to run the Defender. "They're a lot closer than they have been," Picou says. "I have to respect Myiti's commitment to this thing. She's put in a lot of time and effort. She's learned a great deal. Now she's beginning to listen. She's listening to me. She's listening to her father."

While the Sengstacke estate sat dead in the water, its value steadily decreased. The publisher of the Michigan Chronicle, the cash cow, quit to found a competing paper, the Front Page. The Defender wallowed in red ink. "The property's falling apart," says Robert Sengstacke. "There's no internal discipline. It's damn near run into the ground now. I tried to tell Northern Trust [the original trustee of the Sengstacke estate] way back when that whatever you do, don't let the paper just sit there. I gave several examples of things that could be done and wouldn't cost any money."

Tired of the sidelines, Robert Sengstacke is cheering his cousin on. "No two people out there know the business better than Tom Picou and myself," he says. "The best chance Sengstacke Enterprises has is if Tommy can successfully make a bid. Pluria Marshall comes in here learning. Tom Picou comes in here knowing."

Another Picou ally is David Milliner, who was Kurt Cherry's choice to become the Defender's publisher. Picou has known Milliner since Milliner was a Defender copyboy in the early 70s. Now Milliner tells me he expects PublicMediaWorks to have a stake in any offer Picou makes.

"He said that?" asks Picou. "We did talk about it, but there's a strong possibility we might not need it. Even though I like those guys, I don't want to give the impression that Real Times [his company] is even considering the possibility."

After losing his own top investor, Cherry tried joining forces with Marshall, his adversary, in order to stay in the game. The alliance quickly fell apart. "Their ideas were a little bit more cerebral," says Marshall. "Mine were a bit more hands-on. It didn't work, if you will, from a CEO-to-CEO standpoint."

"All the auditions I went to, I didn't get the part," Cherry says wryly. "But the play still goes on. I was the rabbit last year. Let Pluria be the rabbit now. Let him chase the thing."

Marshall is CEO of Equal Access Media, which owns a couple of small newspapers in Texas, where it's based, and some radio stations, including WLTH in Gary; it recently took over 18 community weeklies in Los Angeles. "This is not really a newspaper deal," Marshall says. "You'll find the Defender brand will be extended to radio and to television to some extent. There's a lot of stuff you'll see that's nontraditional from a quote unquote black standpoint but is very much media driven."

To Picou it's very much a newspaper deal. "Black newspaper readers today are the same ones who have been reading them for years, and they're dying off," he says. "But the old philosophy, the old cliche applicable in the 1930s and '40s that blacks had to always be better, still applies today. For us to be competitive, we have to look better and read better. We have to delve into stories the mainstream papers would never touch."

He describes a recent major feature in the Tri-State Defender on black underachievement. He said its ad campaign asserted, "Damn racism, full speed ahead," and its headline asked, "Are African-Americans Responsible?" He says, "We don't get involved in targeting white people as an excuse for our problems. Our position is to challenge black people. Half the black community in Memphis gave us hell."

The Chronicle Chronicles

When Hot Type checked in on the Chronicle of Columbia College earlier this year, everything was wonderful there. The paper was aggressively covering the misadventures of its own college president, it was winning major prizes, and its editor, Amber Holst, was being offered a job by the Wall Street Journal.

Here's what's happened lately. On March 26 Holst fired the sports editor, Graham Couch, whereupon ten other staff members walked out in support of Couch. This week Couch and his allies produced the first and--they tell me--only issue of their own campus newspaper, the Independent Voice.

Couch provided me with copies of his side's recent correspondence. A let-ter from the departed staffers to Carolyn Hulse, who chairs the journalism department, called Holst's motives "personal, vindictive and unjustified." A letter from Couch to Hulse said the "tagteam" of Holst and Chronicle adviser Jim Sulski had turned "the pride of Illinois college journalism" into "the joke of the school." Couch told Hulse he was sure she wouldn't believe him, as Holst "could probably convince the Germans to invade Poland again if she really tried."

Carolin Latta, academic dean of the college, received a letter from former Chronicle staffers asking her to replace Sulski. "We do not wish to ruin the current advisor's career," Latta was assured. Nevertheless, facts had to be faced. Despite Holst's "personal, vindictive and unjustified" motives, Sulski had taken her side.

The Independent Voice carried forward the mutineers' campaign to explain themselves. Couch offered a two-page timeline "of the events preceding and following my firing, along with some insight into my feelings at the time." An essay by "commentary editor" Matt Richmond, who'd held that position at the Chronicle, examined Holst's "bullying and unpredictable" leadership, and described the exasperation of the former editors at being denied "the respect granted any other professionals in our field."

Neither Dean Latta, whom Couch tells me did not respond to the letter to her, nor Hulse, who was out of town, returned my calls. Sulski and Holst declined to discuss the matter. Disinterested friends at the college to whom I turned for direc-tion could tell me only that the Chronicle had become a much better newspaper since Sulski took it over in 1997.

Couch was fired two days after running into Holst and Sulski and a couple of other Chronicle people in a bar late one Friday night and getting into an argument with her. "I was sort of inebriated," he allows, "but as I remember it, it was about our roles at the paper. Had I not been drunk I probably would have walked away."

News Bite

The Community Media Workshop, based at Columbia College, holds monthly brown-bag luncheons, open to the public, at which journalists speak. Next Thursday, May 17, at noon the guests are going to be the Sun-Times's two gentlemen from Vancouver, Michael Cooke and John Cruickshank. Newspaper editors don't often subject themselves to a public grilling. Have at them.

Add a comment