Founded 65 Years Ago, the Media Firm Is Still in the Family
R. David Threshie remembers a time when families ran media companies, particularly newspapers. These days, those memories are a little more distant than they used to be.
Threshie is chairman of Freedom communications Inc. in Irvine,parent of the county’s largest newspaper, The Orange County Register, and one of the 15 largest newspaper businesses in the U.S. The company is one of the few remaining family-owned media operations in the country. Freedom was founded by R.C. Hoiles 65 years ago, and since has had four generations of Hoileses in its ranks. Freedom is unique in an industry where family-owned media companies have taken their businesses public or sold them off to bigger corporate rivals. The company was named the recipient last week of the Longevity Award at the first Family-Owned Business Awards luncheon sponsored by California State University, Fullerton, and the Business Journal. “It does make it a little more difficult to attract help because we’re not a publicly traded company,” said Threshie, the husband of R.C. Hoiles’ granddaughter, Judith Ann Hoiles. “And it does in some cases put us in a little bit of a disadvantage in terms of scale, particularly on the television side of the business. It’s a business challenge that we simply have to find a way to meet.”
Being family-owned in an industry now dominated by large public corporations has meant one thing for Freedom: business as usual, according to Threshie. “In terms of competing in the industry and, more importantly, the marketplace, I don’t think our challenges are any different than any other business’s challenges,” he said. “Competition is competition, and business practice is business practice. You have to be effective and efficient.” Freedom, which started with a handful of daily newspapers, has evolved and adapted to meet the demands of the market over the years. The company, which has an estimated $850 million in annual revenue, now owns 29 daily newspapers, including the flagship Register in Santa Ana, eight TV stations, 20 magazines and more than 50 Internet-related businesses,its newest division. “Where at one time we might have said our mission is to print a newspaper every day, now I think we say our mission is to bring information to our communities,” Threshie said.
With that evolution, have come changes at the helm. For decades, the company kept key management within the Hoiles family. Today, Freedom counts about 65 shareholders. “All the key managers of our company are non-family members,” Threshie said. The family passed a milestone in 1978, said Threshie, when Freedom hired its first non-family chief executive and president, D. Robert “Bob” Segal, a longtime Freedom publisher. He held the posts until 1992, when Freedom appointed its second non-family CEO and president, James N. Rosse.
The company hit its second milestone in the early 1990s when the first non-family member was appointed to its board. The board now is split: six directors from the founding Hoiles family, six non-family members and Freedom’s third non-family chief executive and president, Sam Wolgemuth. Rosse, who retains a board seat, said in a past interview with the Business Journal that the change was inevitable. “The owners are no longer producing enough shareholders with the requisite business experience to provide the sort of authority you need in governance,” he said. Still, Freedom encourages young family shareholders to stay involved in the business. Most have grown up around media businesses, and have taken various positions under the Freedom umbrella over the years. Plus, Threshie said, the family shares a philosophical belief in libertarianism. “That’s somewhat of the glue that bonds the family together,” Threshie said. Yet it hasn’t always been strong enough to prevent family squabbles, especially those that escalated to lawsuits in the early 1980s. The pitfalls of governance in a family-owned corporation flared into the open when a son of founder R. C. Hoiles’ family launched a legal challenge of Freedom’s corporate structure. Harry Hoiles claimed Freedom had strayed from his father’s libertarian perspective, and that two branches of the family were freezing him out of the management picture. He requested a breakup of the company, demanding a third of the assets. The case was thrown out of court, and the company eventually calmed the waters by implementing a more central corporate structure. “The way we’ve gotten past those serious difficulties is to demonstrate that we’re operating the company for the benefit of all the stakeholders,” Threshie said. Though Freedom has adopted more of a public company model, Threshie said there are “no plans whatsoever about going public at this point.” n
