Tribune Bids Due — As ‘The Sun’ Warms Locals

By: E&P Staff

Tribune Co. will likely receive initial offers for the entire company from prospective buyers today, though what happens next is totally unclear. Expert opinions are all over the map, ranging from outright rejection to a total or partial sell-off. But tepid interest may doom the whole idea.

Tribune “probably will draw several nonbinding proposals from a number of investment firms, according to several people following the process,” the Los Angeles Times’ James Rainey and Thomas Mulligan report today. The Times is a Tribune paper, of course.

“But in a mark of tepid enthusiasm, the offers are expected to come in only slightly above Thursday’s closing price of $33.79, near a one-year high of $34.28 for the stock, which has been buoyed by speculation about a deal.

“Industry observers expressed skepticism that the investment firms would follow through with formal bids. A lack of interest in acquiring the entire company could force Tribune to consider offers for particular assets such as the Chicago Cubs….

“One newspaper executive predicted that Tribune, fearing that rejecting all bids would trigger a precipitous drop in its stock, would accept a modest premium over its current market price. Others said that would not happen because independent directors overseeing the process could quickly turn to a second round and take offers for individual assets. Among Tribune’s most prized properties: the Cubs and stakes in the Food Network and online job search site CareerBuilder.

“Another possibility is that Tribune executives will seek partners of their own in a bid to take the bulk of the company private ? perhaps spinning off television stations in the process.”

The entire article can be found at www.latimes.com.

Meanwhile, another Tribune paper is drawing renewed local owner interest. The Sun in Baltimore reports today that a group of prominent business and civic leaders has launched an effort to buy the paper, and sent a letter yesterday indicating its interest to the Tribune in Chicago.

Theodore G. Venetoulis, a former Baltimore County executive, said he wrote Tribune Co. yesterday afternoon on behalf of the newly formed Baltimore Media Group.

The Sun reports today: “Venetoulis chairs the group, which includes Abell Foundation President Robert C. Embry Jr. and longtime civic leader Walter Sondheim. He declined to name the other participants but said that 15 to 20 ‘very successful’ Baltimoreans have expressed interest, depending on the price, and “‘here will be more before it’s over.’

“Venetoulis, who said he has spoken to investment bankers hired by Tribune, said he believes the group has the wherewithal to make a serious bid. It has received interest from several large banks about financing, he said.
Participants see the potential acquisition as a social as well as a business investment, Venetoulis said.”


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