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Murdoch Era Ends at Good Times

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By John Yewell

FOR A DECADE Santa Cruz businesses have been paying millions of dollars to a company controlled by one of the richest and most notorious media moguls of this century: Rupert Murdoch. Recently described by Forbes magazine as the world's sixth wealthiest working billionaire, Murdoch has a worth estimated by Forbes at $5.3 billion. Among his assets has been an interest in the Santa Cruz entertainment weekly Good Times.

Murdoch's holdings include the Fox group of companies, the Times of London, the New York Post, HarperCollins publishers and other newspapers and multimedia holdings around the world. His Australia-based News Ltd. is the largest shareholder in New Zealand's Independent Newspapers Ltd., which, until this week, owned Good Times.

Now, the Murdoch era in Santa Cruz publishing has come to an end.

Missouri-based USMedia Group, which manages Central Valley Publishing Inc., announced July 14 that it had purchased Good Times and 13 community and special-interest newspapers in Southern California. The terms of the deal were not announced.

Central Valley Publishing's president and CEO, Eugene A. Mace, says he plans to maintain Good Times operations as is for the foreseeable future. "We plan to continue to operate Good Times without any changes," Mace said.

Central Valley Publishing is a privately held firm of three investors, according to Mace. Company officials declined to disclose the shareholders, though they confirmed that not all three investors are individuals. USMedia and Central Valley operate more than 30 small market papers in 20 California communities with a combined daily and non-daily circulation of 110,000. The sale was brokered by the private New York investment banking firm Veronis, Suhler & Associates, a media transaction specialist.

CVP's publications include the Daily Californian in El Cajon, the Sun-Star in Merced, the Gilroy Dispatch, the Hollister Free Lance, the Morgan Hill Times and papers in Amador, Madera, Turlock and elsewhere.

Twenty-seven-year-old Jay Shore started Good Times in 1975 after the failure of the weekly Santa Cruz Times. The first issue, on April 3, included in its 16 pages articles by continuing columnist Bruce Bratton and long-time Santa Cruz publishing fixture and former Metro Santa Cruz editor Buz Bezore. For years it touted itself at the bottom of the masthead as "The largest locally owned publication in Santa Cruz."

Good Times, whose slogan was "Lighter than air," differed from the weekly political press of the era, outsurviving numerous competitors by emphasizing good news and avoiding controversy. "I did something that I found made good business sense ... and that is to write about things in a positive light. Especially about your town," Shore said in a 1980 interview. "You know, a bird doesn't shit in his nest."

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The Press Release

Independent News Ltd.

Good Times

West Coast Community Newspapers

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Shore ran the paper for 13 years. In 1988 he accepted a seven-figure offer and sold the paper to the offshore Independent Newspapers Ltd. In a story he wrote about the sale in Good Times' April 7 issue, Shore mentioned INL as the principal new shareholder but made no mention of Murdoch, who then held a 40 percent stake in INL through The News Ltd., Murdoch's Australian company. The masthead reference to "The largest locally owned publication in Santa Cruz" was quietly dropped, and less than a year later, in February 1989, Shore left the paper altogether. Shore's former business manager, Carole Atkinson, was promoted to publisher, a position she currently holds.

Good Times was not the first U.S. property snatched up by Murdoch's INL. In 1986 INL bought Houston Community Papers' 15 publications. In 1991 it bought North Coast Publishers, a group of San Diego County papers. Soon after Good Times was rolled into the California group, which became West Coast Community Newspapers.

Good Times performed well financially, but according to industry observers, most of the other California papers experienced problems. Formats were repeatedly changed, news coverage suffered, and papers were combined or cannibalized. When INL put Good Times on the market, it was as a package with other WCCN publications. Mace said his company planned to close WCCN's unprofitable papers in San Diego County.

Murdoch's firm first bought 29 percent of INL's predecessor in 1964. He continued to increase its stake in INL through the '90s, so that The News Ltd. now owns more than 49 percent of INL. His son, Lachlan, was recently installed on INL's board of directors, on which three other News Ltd. executives also serve.

The News Ltd. has a complex international corporate lineage. It is part of News International of the UK, a wholly owned subsidiary of News Corp. Ltd., Murdoch's international holding company headquartered in Sydney with assets of $32.7 billion. Among the members of News Corp.'s board of directors is Geoffrey C. Bible, CEO of Phillip Morris.

INL sold Good Times and the other papers as part of a plan to move into electronic media. Last September INL acquired a 48 percent stake in New Zealand's Sky Network Television for $308 million. Then two weeks ago INL increased its holdings in New Zealand's Terabyte Interactive, a multimedia firm, from 51 to 75.5 percent.

Last February it sent out feelers that it was considering dumping its small California and Texas presses in order to buy down its debt on the new acquisitions.

A February 1998 article by the Dow Jones News Service quoted INL Chief Operating Officer Rick Neville saying the Houston Community Newspapers and WCCN "were being looked at as part of the company's normal ongoing review of its assets."

In other words, they were for sale. "From time to time we look at various assets and try to determine whether they're core to our business or not," Neville said, "particularly following our big investment into Sky Network Television. Obviously there are some assets that are more disposable. I think people would say the U.S. papers are less core than other parts of the business."

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From the July 16-22, 1998 issue of Metro Santa Cruz.

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