Tribune Co has accepted a buyout offer from real estate investor Sam Zell in a deal valued at about US$8.2 billion, the media company said yesterday.
Tribune said Zell plans to invest US$315 million in the deal and the company will sell the Chicago Cubs baseball team at the end of this season.
He will eventually become chairman of the Chicago-based company's board when the deal is complete.
Members of a special committee of board members had spent much of the week sifting through dueling offers for the US's second-largest newspaper publisher by circulation.
The Zell offer involved an ESOP, which resembles a profit-sharing plan, but allows the company to borrow money and repay loans using pretax dollars.
Payments of both interest and principal are tax-deductible and would create more leverage for a buyer.
Tribune also is 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.
Like most newspaper companies, Tribune has been struggling with declining profits, circulation and advertising revenues.
Last month, the company announced revenue had fallen 3.4 percent in February as its publishing division continued to struggle.
In addition to the Chicago Tribune, the company owns nine other daily newspapers, including the Los Angeles Times, as well as 23 TV stations and the Chicago Cubs baseball team.
Tribune's share price fell about 50 percent from early 2004 until last spring and has languished at just above US$30 for months, down from an all-time high of $60.88 in November 1999.
Its shares climbed nearly 2 percent on Friday on the NYSE as investors awaited an announcement from the company.
Zell, 65, has earned a reputation as an astute investor, making his fortune reviving moribund real estate.
After a bidding war culminated in February, he sold his company, Equity Office, to the private equity firm Blackstone Group for US$23 billion.
He is proposed using an employee stock ownership plan as a way to lower the taxes of any sale, but has said he had no plans to break up the company.
Tribune said yesterday that it was planning to sell the Chicago Cubs at the end of this year's baseball season.
This would put one of its most valuable assets on the block as it simultaneously announced Zell was acquiring the media conglomerate.
Analysts have estimated that the Cubs could fetch US$600 million or more.
Tribune bought the baseball team in 1981 for approximately US$20 million.
"The Cubs have been an important part of Tribune for more than 25 years and are one of the most storied franchises in all of sports," said Dennis FitzSimons, Tribune chairman, president and chief executive officer.
"In our last season of ownership, the team has one mission, and that is to win for our great fans," her added.
Tribune said the company's 25 percent interest in Comcast SportsNetChicago would be part of the sale package.
The Central Weather Administration (CWA) yesterday said it expected to issue a sea warning for Typhoon Fung-Wong tomorrow, which it said would possibly make landfall near central Taiwan. As of 2am yesterday, Fung-Wong was about 1,760km southeast of Oluanpi (鵝鑾鼻), Taiwan’s southernmost point, moving west-northwest at 26kph. It is forecast to reach Luzon in the northern Philippines by tomorrow, the CWA said. After entering the South China Sea, Typhoon Fung-Wong is likely to turn northward toward Taiwan, CWA forecaster Chang Chun-yao (張峻堯) said, adding that it would likely make landfall near central Taiwan. The CWA expects to issue a land
The Central Weather Administration (CWA) yesterday said it is expected to issue a sea warning for Typhoon Fung-wong this afternoon and a land warning tomorrow. As of 1pm, the storm was about 1,070km southeast of Oluanpi (鵝鑾鼻), Taiwan’s southernmost point, and was moving west-northwest at 28 to 32kph, according to CWA data. The storm had a radius of 250km, with maximum sustained winds of 173kph and gusts reaching 209kph, the CWA added. The storm is forecast to pass near Luzon in the Philippines before entering the South China Sea and potentially turning northward toward Taiwan, the CWA said. CWA forecaster Chang Chun-yao (張峻堯) said
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The Central Weather Administration (CWA) yesterday issued a sea alert for Typhoon Fung-wong (鳳凰) as it threatened vessels operating in waters off the Pratas Islands (Dongsha Islands, 東沙群島), the Bashi Channel and south of the Taiwan Strait. A land alert is expected to be announced some time between late last night and early this morning, the CWA said. As of press time last night, Taoyuan, as well as Yilan, Hualien and Penghu counties had declared today a typhoon day, canceling work and classes. Except for a few select districts in Taipei and New Taipei City, all other areas and city
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