Jack Griffin, the CEO of Tribune Publishing Co. — which owns the L.A. Times, Chicago Tribune and several other daily newspapers, has stepped down in the midst of a management change, which comes close on the heels of entrepreneur Michael Ferro becoming the company's biggest single shareholder.
Even though Tribune Publishing announced Griffin's departure on Tuesday morning, it did not offer any explanation on the change in leadership. Jack Griffin will be replaced by Justin Dearborn, Merge Healthcare's CEO. Dearborn will take over as the company's CEO and board member with immediate effect.
Chicago-based Merge Healthcare was acquired in October 2015 by IBM for $1 billion and is backed by Ferro. Dearborn and Ferro have worked with each other since 1997.
"The board thanks Jack Griffin for his significant contributions and wishes him the best of luck in his future endeavors," notes Ferro, Tribune Publishing's non-executive board chairman.
Griffin's investment firm Merrick Media has a 16.6 percent stake in Tribune Publishing after he invested $44.4 million earlier this month.
Media analyst Ken Doctor was the first to report of Griffin's ouster on Monday and revealed that the ex-CEO did not see the decision coming. Doctor also said that Ferro had been in consultation with top executives of Tribune Publishing in the past few weeks and convinced the board to relieve Griffin. The board reportedly gave Ferro "quick approval to fire Griffin."
Interestingly, Griffin's contract was to expire in March 2017 and, therefore, he will receive a severance of $2 million — double his annual salary. Moreover, Griffin will receive $1.5 million as stock options and grants that the ex-CEO would have accumulated in the next one year.
This is in addition to any stock options or bonuses Griffin is eligible to get from the 2015 fiscal year. His dental and health benefits will be paid for by Tribune for a year or till he gets a new job.
Dearborn has a two-year contract which is modest by comparison and will be earning $600,000 per year. He will be entitled to a bonus of $420,000 and not given any stock rewards.
Ferro and Dearborn have been working since 1997 when the latter joined startup Click Commerce, which was an e-sales platform for manufacturers. Click Commerce was the brainchild of Ferro and sold for $292 million to Illinois Tool Works in 2006.
Dearborn also worked with Motorola, before it split, prior to his stint at Click Commerce. At Motorola he specialized in intellectual property transactions. Dearborn is an Illinois State University alumnus — he pursued B.A. in accounting. He also has a degree in law from DePaul University.
Whether Dearborn will be able to utilize his experience effectively and pull off the demanding role remains to be seen. He is, however, optimistic that he will be able to live up to the challenges despite the management changes.
"Although this is a different medium than my last technology company, it has the same challenge on how to create the highest value for our content," says Dearborn.
