News About The Tribune Company

[macuser1]

Here's a selection from a long article in today's WSJ. I would have posted a link, except it's from a paid site:

 

A rift on the board of Tribune Co. is setting the stage for a possible showdown between executives at the media company and its second-largest shareholder, the Chandler family trusts.

 

In a securities filing yesterday, Tribune disclosed that all three directors appointed by the Chandler Trusts to the company's 11-member board had voted against the company's sweeping buyback program. That plan, announced last week, entails taking on about $2 billion of new debt to buy back up to 25% of the company's outstanding shares.

 

By laying bare the board disagreement, the unusual filing raises new questions about the challenges facing Tribune. The Chicago-based company, one of the nation's largest newspaper and broadcasting concerns, already has faced shareholder pressure for its poor stock performance at a time when newspapers are seeing readership decline and new competition from the Internet. Some investors saw the buyback as an effort to discourage hostile buyers or the kind of investor pressure that pushed Knight-Ridder Inc. into a sale, since taking on substantial new debt would make Tribune less appealing to suitors.

 

 

The Chandlers, who gained a 12% stake in Tribune through its $8.3 billion acquisition of Times Mirror Co. in 2000, didn't disclose their next move in the terse filing. The document merely reported that the three Chandler-nominated board members "do not share the opinions" of the company on the stock buyback.

 

But the filing itself shows the family, which controlled the Los Angeles Times for generations and was once among the best-known names in publishing, has moved into opposition against Tribune executives. At the least, intentionally or not, it could stir up other investor discontent.

 

So one has to wonder if the Cubs won't be sold after all the dust settles.

[CubinNY]

Here's a selection from a long article in today's WSJ. I would have posted a link, except it's from a paid site:

 

A rift on the board of Tribune Co. is setting the stage for a possible showdown between executives at the media company and its second-largest shareholder, the Chandler family trusts.

 

In a securities filing yesterday, Tribune disclosed that all three directors appointed by the Chandler Trusts to the company's 11-member board had voted against the company's sweeping buyback program. That plan, announced last week, entails taking on about $2 billion of new debt to buy back up to 25% of the company's outstanding shares.

 

By laying bare the board disagreement, the unusual filing raises new questions about the challenges facing Tribune. The Chicago-based company, one of the nation's largest newspaper and broadcasting concerns, already has faced shareholder pressure for its poor stock performance at a time when newspapers are seeing readership decline and new competition from the Internet. Some investors saw the buyback as an effort to discourage hostile buyers or the kind of investor pressure that pushed Knight-Ridder Inc. into a sale, since taking on substantial new debt would make Tribune less appealing to suitors.

 

 

The Chandlers, who gained a 12% stake in Tribune through its $8.3 billion acquisition of Times Mirror Co. in 2000, didn't disclose their next move in the terse filing. The document merely reported that the three Chandler-nominated board members "do not share the opinions" of the company on the stock buyback.

 

But the filing itself shows the family, which controlled the Los Angeles Times for generations and was once among the best-known names in publishing, has moved into opposition against Tribune executives. At the least, intentionally or not, it could stir up other investor discontent.

 

So one has to wonder if the Cubs won't be sold after all the dust settles.

 

I don't know why the Trib would want to sell one of it's more profitable concerns. It would seem to me to be bad business. If I were them I'd sell off a loss leader or three.

 

BTW: Go Mac!

[Banedon]

I've decided that Cuban should just buy the Tribune... :D

[minnesotacubsfan]

I've decided that Cuban should just buy the Tribune... :D

 

 

lol..the whoooooolllle dman thing!!!

 

I like it......

[macuser1]

I wouldn't object to a sale to Cuban. My intent wasn't to start another thread about that, not exactly.

 

When a company neeeds to raise a large amount of cash, that company can either sell assets or borrow. The Tribune Comapny was trying to take the debt route, with the cash being used to by back shares to boost the price of the remaining shares.

 

But of course that means taking a certain risk that the actual cash flow willl improve to the point where the debt could be paid off.

 

It's pretty interesting that a major shareholder group, the Chandlers, who would certainly benefit from a higher share price, are objecting to this strategy. They must feel that the turn around strategy of the management won't work, that the debt won't be repaid, and the company gets dissolved.

 

So this leaves the strategy of selling assets. So which type of asset wil bring more cash, one which is making money or one which is losing money? If the Trib were to sell off the losers, about all it's got left are the broadcast assets and the Cubs.

 

My strategy would be to forget about the buyback, sell off some of the losers, and reinvest the proceeds in some of the more promising parts of the company.

 

But yeah, Cuban for owner!

[RynoRules]

Cuban's too smart to buy the Trib. Newspapers will be irrelevant in 10 years. I know the Trib has other assets, including some on the web, but still...

[Banedon]

Cuban's too smart to buy the Trib. Newspapers will be irrelevant in 10 years. I know the Trib has other assets, including some on the web, but still...

 

You're right of course. I was joking....kinda sorta.... :D