Zell Wins Bidding For Tribune Co.
April 2, 2007 at 6:23 AM (PT)
Investor SAM ZELL's bid to buy TRIBUNE CO. has been accepted by the company's board. ZELL is offering $8.2 billion plus assumption of about $5 billion in debt for the company, about $34/share, which has edged out a late bid by LOS ANGELES billionaires ELI BROAD and RON BURKLE. The deal reportedly includes a low break-up fee that may open the door for BROAD and BURKLE to try to step back into the bidding despite the board's acceptance of ZELL's bid. While ZELL has previously said that he does not intend to break up the company to raise money to pay off debt, he now says he will sell the CHICAGO CUBS after the completion of the 2007 season, as well as the company's 25% stake in COMCAST SPORTSNET CHICAGO.
ZELL, whose bid includes an employee stock ownership plan, matched BROAD and BURKLE's bid late SUNDAY. His plan reportedly includes a limited personal investment of less than $300 million and the assumption of the company's debt. The company would borrow additional money to pay shareholders about $34 a share in two stages, after which the company would be taken private.
TRIBUNE owns one radio property, Talk WGN-A/CHICAGO.