Zell of an Offer: Makes Strong Bid for Tribune

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Billionaire investor Sam Zell has presented a $33 per share proposal for Tribune Co., according to a published report.

A special board committee received details of the proposal this week, the Los Angeles Times reported in a story on its Web site Friday, citing a person familiar with negotiations who spoke on the condition of anonymity because deliberations are supposed to be confidential.

A $33 per share bid would be a $2.47 premium over Tribune’s closing price of $30.53 Friday on the New York Stock Exchange.

[The Times reports late Friday, “Investment bankers are working feverishly to try to strike a deal, but so many details remain to be ironed out that the company may not be able to meet its self-imposed deadline to conclude deliberations by the end of the month, the person familiar with the negotiations said. It’s possible that Chicago-based Tribune will opt, instead, to reorganize itself and pay shareholders a large dividend.” But it’s source said that ell “has improved his offer substantially…Many people would argue it is the best solution for shareholders.”]

Messages seeking comment were left Friday evening by The Associated Press for representatives for Tribune and Zell.

Zell declined during an interview with the AP earlier this week to discuss the status of talks with Tribune, but confirmed his proposal calls for an employee stock ownership plan. The real estate mogul also said he does not intend to break up the company.

The media conglomerate, which owns the Chicago Tribune, the Los Angeles Times and nine other daily newspapers, as well as 23 TV stations and the Chicago Cubs baseball team, has been soliciting a buyer for some or all of its assets since last year.

Under pressure because of its long-sagging stock price, it appointed the special board committee in September to review options for its business – including a possible sale, breakup, or offers to be taken private. Its self-imposed deadline for making a decision is March 31.

Tribune earlier this year was reviewing possibilities that included a recapitalization with a broadcast unit spinoff, led by the Chandler family shareholders whose pressure prompted the review, and a public leveraged buyout by Los Angeles billionaires Ron Burkle and Eli Broad. But both offers, made in January, have failed to produce a deal.

The company also has been said to be considering a “self-help” plan that would involve spinning off the company’s broadcast division and borrowing money to pay a one-time cash dividend to shareholders. But there reportedly are concerns that would leave Tribune still saddled with debt.


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