It could be...
New York Times
April 2, 2007
Tribune Presses Real Estate Magnate to Increase His Bid
By ANDREW ROSS SORKIN and KATHARINE Q. SEELYE
In last-minute negotiations tonight, executives for the Tribune Company were pushing Sam Zell, the Chicago real estate tycoon, to increase his bid for the company. If Mr. Zell were to make a higher offer, the company seemed prepared to announce him as the winner of the bidding, according to people close to the process.
If Mr. Zell were to walk away, it was not clear whether the Tribune board members would accept a rival bid from Ronald W. Burkle and Eli Broad, two Los Angeles billionaires, or whether they would decide to restructure the company themselves.
Last week, Mr. Zell’s bid of $33 a share, which he already increased once, had been $1 below the Burkle-Broad bid.
On Friday afternoon, Tribune executives told Mr. Zell that he would have to offer them more money if he wanted to buy the company, the people said; Mr. Zell came back with a new bid of close to $34 a share.
The Tribune board met on Sunday morning and rejected Mr. Zell’s latest offer, telling him he would have to increase it yet again and giving him 12 hours to do so. People close to the situation, who sought anonymity because they were not authorized to speak to the news media, said the board planned to meet late Sunday night, but it was not clear what Mr. Zell would do or whether he would return with an offer at all.
The Tribune board has favored Mr. Zell over Mr. Burkle and Mr. Broad, in part because Mr. Zell’s offer is further along and could be finished more quickly, these people said. In addition, the board would prefer to sell the company stay in the hands of a Chicagoan like Mr. Zell, rather than to people with ties to Los Angeles.
Mr. Zell, who has said his sole interest in buying Tribune is economic, not editorial, has made billions in real estate and has been known to walk away from deals that he thought were too expensive.
Tribune, which owns The Los Angeles Times, The Chicago Tribune, nine other papers and 23 broadcast outlets, has been on the auction block since September. There was little interest in it, although Mr. Broad and Mr. Burkle combined in January to offer $27 a share. The board dismissed that and began concentrating on a plan to have management restructure the company itself, including spinning off the television properties.
But Mr. Zell entered the picture in February and has been negotiating back and forth over the last several weeks. The board has seesawed on his bid, perceiving it as still too low and also concerned that he would be putting in only $300 million of his own money and taking on too much debt. He centered his proposal on an employee stock ownership plan.
Then last week, Mr. Broad and Mr. Burkle complained that in order for Mr. Zell to offer a stock ownership plan, he must have received financial information that they had not received earlier. They revived their plan, offering $34 a share and $500 million of their own money and also basing it on a stock ownership plan.