Blog Post

Tribune Board Committee Reviews Options; TV Stations May Be Key

Despite the intense focus on the Tribune’s newspapers, the special board committee responsible for reviewing the paltry three bids and the company’s other options can’t pass go on any of them until the value of the company’s 23 TV stations is resolved. As the WSJ notes, the stations make up about one-third of the company’s revenues. One offer Tribune received by its somewhat artificial deadline was by the Carlyle Group for the TV stations alone while the Chandler offer relies on a spin-off of the broadcasting division. The Eli Broad-Ron Burkle plan includes a recapitalization, which again brings broadcasting into the equation. (The two pitched their plan personally to the committee Saturday in Chicago.)
So far, the committee’s intentions are as clear as the Chicago River. The committee could recommend that the company act on its own, an option that seems as likely as any other. Possibilities: borrow money for a shareholder payout, then sell or spin of the TV stations, any combination thereof. Committee statement.
WSJ: “A person familiar with the process said that the company also was exploring how to use the McCormick Tribune Foundation, a charitable foundation controlled by Tribune’s management, in any possible transaction.”
NYT: “People close to the process have said that the outside offers were perceived as inadequate and that the company could take itself private on its own, sell off its broadcast unit or undertake a stock buyback. It could also do nothing.”
Tribune Update: Three Bids In, None Stunning; Chandlers, Burkle & Broad Vie