Stocks at Other Companies Mostly Lower After Tribune Deal

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Shares of newspaper publishers traded mostly lower Monday after Tribune Co., which owns the Chicago Tribune and Los Angeles Times, as well as other dailies, accepted an offer from real estate investor Sam Zell in an $8.2 billion deal.

The Chicago-based media conglomerate had performed a six-month strategic review, and late last week received a sweetened offer from Los Angeles billionaires Eli Broad and Ron Burkle — before accepting Zell’s bid.

Zell plans to invest $315 million in the deal and will eventually become chairman of the company’s board when the deal is complete sometime in the fourth quarter.

Tribune, which said it plans to sell the Chicago Cubs baseball team at the end of this season, is the nation’s second-largest newspaper publisher by circulation, with titles including the Chicago Tribune and Los Angeles Times. It also owns nine other daily newspapers and 23 TV stations.

Analyst Alexia S. Quadrani of Bear Stearns said in a client note that Tribune’s deal may not be good news for the sector.

“We believe this complicated and heavily levered transaction is another indication of the waning interest in the newspaper business given the ongoing secular challenges that are weighing on the fundamental outlook,” she wrote.

Shares of Tribune gained 84 cents, or 2.6 percent, to $32.95 in midday trading on the New York Stock Exchange. The stock has been trading in a 52-week range of $27.09 to $34.28.

New York Times Co. shed 12 cents to $23.39, while Gannett Co. was up 1 cent at $56.30 on the NYSE. McClatchy Co. dropped 42 cents to $31.19, after diving to a new 12-month low of $31.03 earlier in the session.

Meanwhile, Washington Post declined $8.80 to $754.70 on the Big Board.

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