Sale looms for salvaged publisher's papers
Tribune - which completed its bankruptcy paperwork this week - has not announced the sale of assets, but it is likely to do so in the next several months so it can streamline its business, said Reed Phillips, a managing partner of DeSilva & Phillips, a media banking firm.
The troubled state of the newspaper industry makes those assets most likely to be sold, he said. Less clear is whether the company will sell them all at once or by region.
"The company is too large and complex right now, coming out of bankruptcy," Mr Phillips said. "What's needed is a more focused strategy."
Aaron Kushner, chief executive of Freedom Communications and publisher of The Orange County Register in California, confirmed on Monday that he was eager to buy Tribune's newspapers.
He said that from what he had gleaned from bankruptcy court filings and public pension documents, it seemed likely Tribune would sell its newspapers as a group. That was because the company has such complex pension obligations and corporate overheads that it would be difficult to untangle them and sell properties individually.
"We're interested in all of the papers, though obviously, from an outside perspective, we have not seen the numbers," said Mr Kushner. "If papers are sold, someone has to be responsible for the pensions."
The company's reorganisation plan was approved in July by the US Bankruptcy Court in Delaware. It received final approval from the Federal Communications Commission in November.
The announcement on Monday ended a four-year process for the company. Its assets were tied up in court while the media industry continued its digital transformation. In a letter to employees, Eddy Hartenstein, Tribune's chief executive, acknowledged that the past four years had been "challenging."
The end of the bankruptcy has led to plenty of speculation about who might buy Tribune's newspapers, with names including Rupert Murdoch and David Geffen floated as contenders. Mr Phillips said he was sceptical that Mr Murdoch would be a serious bidder because his company had so much else on its plate.
"I would think they would take a look," said Mr Phillips. "But when it comes to stepping up and making a substantial offer, I would be surprised. They're already splitting off the publishing business from the entertainment business."
Frequently Asked Questions about this Article…
Tribune Co has just emerged from bankruptcy protection after a reorganisation plan approved by a US bankruptcy court in July and final FCC approval in November. With the company coming out of a four‑year court process, management and advisors say it may sell newspaper assets in order to streamline the business and adopt a more focused strategy.
The article says the company is likely to sell newspaper assets in the next several months, but it's unclear whether those assets will be sold all at once or by region. Media bankers and potential buyers have raised both possibilities.
Aaron Kushner, CEO of Freedom Communications and publisher of The Orange County Register, confirmed he is eager to buy Tribune's newspapers. The article also notes speculation about high‑profile names such as Rupert Murdoch and David Geffen being floated as potential contenders.
According to buyers and advisers quoted in the article, Tribune has complex pension obligations and corporate overheads that would make it difficult to untangle individual properties. That complexity suggests buyers — or a single buyer — would likely need to take responsibility for the pensions as part of any deal.
Advisers in the article describe the newspaper industry as troubled, which makes those assets the most likely candidates for sale. At the same time, the troubled sector and the complexity of Tribune's structure make the sales process challenging.
The article indicates prospective buyers are preparing for negotiations and that Tribune is likely to announce asset sales in the next several months, though no formal sale timetable was provided.
The article reports speculation about Rupert Murdoch as a possible contender, but Reed Phillips, a media banking partner quoted in the story, expressed scepticism that Murdoch would make a substantial offer because his companies already have significant other commitments.
Everyday investors should watch for official announcements about asset sales, whether newspapers are offered as a group or individually, and any information about who will assume pension obligations. Those developments will indicate how Tribune plans to streamline operations and refocus its business following bankruptcy.
Call 1300 880 160
Start a chat
Schedule a call
