L.A. Earthquake? Thursday Tribune Meeting Could Be Key

By: Jennifer Saba This Thursday could bring a whole new direction for the Tribune Co.

A board meeting is scheduled to consider the future of the company in addition to striking a deal with the Chandler family, the company?s largest shareholder, which could unwind a complicated partnership that has gone sour.

The Wall Street Journal reports today that the directive could mean a sale of the troubled Los Angeles Times as several interested parties, including David Geffen and Ron Burkle, have allegedly approached Tribune to buy the paper.

Geffen reportedly made an all-cash offer to the company, while Burkle and Eli Broad, a philanthropist, contacted the Chandler family to discuss a possible deal, according to the Journal. They also sent a letter to Tribune?s board expressing interest.

Tribune initially rebuffed their offers. FitzSimons wrote to the parties that the board did not want to discuss a transaction. ?If our perspective changes, we will contact you,? the Journal reports FitzSimons writing.

Broad told the Journal: ?I have no way to pressure them; but they know of my interest, they know of Ron Burke?s interest. They also have a letter from David Geffen. We aren?t pressuring them in any manner. It?s up to management, the board and their shareholders, what they want to do. I think the paper will be far better off with local ownership.?

The Tribune board?s perspective could change by Thursday as local leaders and management at that Times have been turning up the heat at the Chicago-based headquarters to stop making cuts to the paper.

Last week, 20 prominent people in Los Angeles, including former U.S. Secretary of State Warren Christopher, Elise Buik, CEO of United Way of Greater Los Angeles, and Gary Toebben, CEO of the Los Angeles Chamber of Commerce signed their names to a letter stating that further cutbacks at the Times will hurt the paper. They suggested Tribune should put the Times on the block.

What impact the letter has is unclear. The Journal said that the people who sent the missive are not working in tandem with potential buyers like Geffen and Burkle.

But pressure is mounting from inside the paper?s ranks as well. In a rare joint stance, both Editor Dean Baquet and Publisher Jeffrey Johnson told Tribune they would not institute any more cuts after Tribune Publishing President Scott Smith suggested more lay-offs at the paper.

"I think the Tribune has squandered its good will inside the L.A. Times newsroom," John Carroll, the former editor of the paper, told the Journal. "I would say that if you look at the six years Tribune has owned the Times Mirror papers, all those papers have been badly diminished. It's been a worse talent drain than anywhere I've seen."

But Smith told the Journal: ?We believe there are opportunities to smartly collaborate on news coverage and editing, and we are doing that in significant ways, largely building off the talents of the journalists at the Los Angeles Times. All the advantages of scale clearly apply as we think about the Los Angeles Times as part of Tribune. It?s our largest newspaper, the largest and most diverse metro area we serve in full.?

There have been rumblings in the industry that Tribune would be the next company up for grabs after Knight Ridder announced it would put itself on the block after a hostile showdown with its three largest shareholders.

In May, Tribune announced it planned to buy back 25% of its stock and raise roughly $500 million in asset sales that included divesting many of its TV stations across the country. The Chandler family opposed the move through a series of scathing letters written to the Tribune board and demanded among other things the possible sale of a company.