Update: A slew of reports Sunday from a variety of media outlets (who could all be talking to the same person as far as we know) claiming that a deal could be announced as soon as Monday. We’ll go with Newsday, which actually talked to CVC’s Charles Dolan” “I think they’re just finishing things and we should hear something shortly. They have an infinite reservoir of minor details that they need to address.” The deal would be financed by $650 million in bonds by Bank of America, with Cablevision (NYSE: CVC) paying Tribune $612 million in cash and $18 million in rent payments for Newsday properties; Tribune would hold 3 percent, valued at roughly $20 million. The paper reportedly earned $90 million on $500 million in revenue in 2007.
Original: News Corp (NYSE: NWS). has withdrawn its $580 million bid for the Tribune’s Newsday, calling it “uneconomical,” according to Reuters. The remaining likely bidder for the New York newspaper is cable TV operator Cablevision, which also operates in Long Island.
A News Corp spokesman told *Reuters* the company was unable to justify outbidding Cablevision’s $650 million offer, calling it “uneconomical.” New York Daily News owner Mortimer Zuckerman also has out a matching bid to News Corp, and suggests it could close a deal faster so it should be the preferred buyer.
Staci adds: Murdoch has known for more than a week of the higher bid, choosing the very public forum of News Corp’s earnings call Wednesday to express confidence in his company’s chances even at the lower price. He told a Newsday reporter on a conference call that he didn’t think Cablevision would win, implying an existing deal with Tribune CEO Sam Zell, and to “just be patient for a couple of days, will you?” But he also added: “We are certainly not in the business of getting into an auction here.” A day later, he told a NY Observer reporter: “Yeah, I might have gone a little too far saying it was a certainty. I was telling the truth, but you don’t know until…”
Zell also known all along that News Corp, Murdoch’s bluster to the contrary, faced a tougher hurdle than most other buyers when it came to getting federal clearance for the acquisition. He might have been willing to take the chance for the right consideration and the chance to build a cooperative relationship with Murdoch but Cablevision’s significantly higher bid threw a spanner in the works.
Newsday: Zell and Murdoch shook hands on a deal in April. The paper also suggests that Tribune and News Corp still could work together on cost-cutting ventures, including printing both papers in one place.