Lenders may get control of Tribune Co. (Dinosaur Media DeathWatch™)

Chicago Tribune ^ | June 8, 2009 | Michael Oneal

[abb]

Chicago-based Tribune Co. and its creditors are in the early stages of negotiating a plan of reorganization in U.S. Bankruptcy Court that sources said likely would transfer control of the troubled media conglomerate from Chicago billionaire Sam Zell to a group of large banks and investors that holds $8.6 billion in senior debt.

The plan is still taking shape, the sources said, and much could change as negotiations continue.

But the general contours of a new capital structure are coming into focus, and the plan centers on a debt-for-equity swap that probably would give the senior lenders a large majority ownership stake in the reorganized company.

A source with knowledge of the situation said the plan would wipe out a $90 million warrant Zell negotiated as part of his $8.2 billion deal to take the company private in 2007. The warrant gives the Tribune Co. chairman the right to buy about 40 percent of the company for $500 million and is the basis of his control over Tribune Co., which owns the Chicago Tribune.

Zell also holds a $250 million note representing a loan he made to the company as part of the going-private transaction. That note, however, is near the bottom of the hierarchy of claims in Tribune Co.'s Chapter 11 bankruptcy case, and the source said it is unlikely it would retain any value as the capital reorganization proceeds.

Bankruptcy experts said the plan's outline raises questions about whether the senior lender group would want to retain Zell and his management team or seek new leadership for the company. It also poses the question of whether Zell would want to stay without a large ongoing stake in the company.

snip

[abb]

Good analysis. The negative cash flow is the chicken bone in the throat. They’re almost done for. Notice how the deal to sell the Cubs hasn’t closed yet.

Soon - very soon - there simply won’t be any money in the till to buy paper and ink and pay the pressmen to roll the presses.

[abb]

http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aJ7H3gHnWjS4
CBS Cut to Lowest Investment Grade by S&P on Ad Drops

http://www.independent.co.uk/news/media/online/andrew-keen-it-is-up-to-the-unwired-class-to-get-online-and-save-themselves-1699131.html
Andrew Keen: It is up to the unwired class to get online and save themselves

[Landru]

"Bankruptcy experts said the plan's outline raises questions about whether the senior lender group would want to retain Zell and his management team or seek new leadership for the company."

Matters only to zerO.
Otherwise who the hell cares about the bod if the head's dead.

"The vultures are circling. The smell of death wafts across the savanna..."

Uh-huh. :^)

[abb]

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http://www.time.com/time/business/article/0,8599,1902202,00.html
Can Computer Nerds Save Journalism?

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http://www.forbes.com/2009/06/05/internet-advertising-newspapers-business-media-san-diego.html
San Diego News Shoot-Out

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http://www.broadcastingcable.com/article/278632-New_York_Pool_WNYW_WNBC_WCBS_WPIX.php
New York Pool: WNYW, WNBC, WCBS, WPIX
Fox, NBC, CBS and Trib join forces in Gotham

http://www.broadcastingcable.com/article/278615-Report_Broadband_Adoption_Efforts_Must_Eliminate_Access_Barrier_.php
Report: Broadband Adoption Efforts Must Eliminate “Access Barrier”
Report on broadband adoption efforts says government, industry must sell broadband as necessity, not luxury.

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http://www.adweekmedia.com/aw/content_display/mediaupfront/news/broadcast/e3i0fe06f39ca1404325c30b4cd638baa20?ref=adweek
Upfront Market: Auto Spend Driven Down This Year

[abb]

http://www.dailyfinance.com/2009/06/08/tribune-and-sam-zell-good-riddance/
Tribune and Sam Zell: Good riddance

[GOPGuide]

I don’t want Chapter 11, I want Chapter *7* - Liquidation Baby!!!

[abb]

http://tunedin.blogs.time.com/2009/06/08/if-the-journalism-business-fails-who-pays-for-journalism/
If the Journalism Business Fails, Who Pays for Journalism?

http://www.niemanlab.org/2009/06/charging-a-lot-for-news-online-the-newport-daily-news-new-experiment-with-paid-content/
Charging (a lot!) for news online: The Newport Daily News’ new experiment with paid content

http://www.baltimoresun.com/entertainment/tv/bal-ae.zontv07.1jun07,0,1149975.story
Recession redrawing local media landscape, with no end in sight

http://pressherald.mainetoday.com/newsupdate.php?updates/22-at-blethen-maine-told-theyll-lose-jobs
22 at Blethen Maine told they’ll lose jobs

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http://www.ajr.org/Article.asp?id=4789
The Death of Slow Journalism

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http://www.stillanewspaperman.com/2009/06/08/a-little-humanity-please/
A little humanity, please

[abb]

http://mediadecoder.blogs.nytimes.com/2009/06/08/voting-underway-at-boston-globe-over-proposed-pay-cuts/
Voting Underway at Boston Globe Over Proposed Pay Cuts

[andyandval]

Voting Underway at Boston Globe Over Proposed Pay Cuts

Staying tuned...can't wait to see how this turns out.

[abb]

http://www.csmonitor.com/2009/0609/p02s02-ussc.html
Boston Globe: A vote on the future of newspapers?

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http://online.wsj.com/article/SB124446065172493915.html
Boston Globe Union Casts Crucial Votes

[andyandval]

The union, the Boston Newspaper Guild, has said that if the current contract offer is rejected and the Times imposes a 23 percent across-the-board wage cut, it will file a grievance with the National Labor Relations Board (NLRB), charging the Times had negotiated in bad faith. That could tie the paper up in legal proceedings for months, if not years, while the NLRB makes a determination.

A lose-lose situation for the union.

Go ahead and file that grievance...the pay cut will be in place no matter.

If they win in at the NLRB in about four years there will be nothing left anyway.