Tribune Hires JPMorgan, Evercore to Explore Sale of Newspapers
Tribune Co. (TRBAA), the publisher that emerged from bankruptcy at the end of last year, said it hired JPMorgan Chase & Co. (JPM) and Evercore Partners Inc. (EVR) as financial advisers after receiving unsolicited interest in its newspapers.
The advisers will help Tribune consider all of its options and determine whether the interest is credible, according to an e-mailed statement yesterday from Gary Weitman, a Tribune spokesman. Jimmy Lee, JPMorgan’s vice chairman, will advise Tribune, according to a person familiar with the matter who asked not to be named because the agreement is private.
In addition to the Chicago Tribune and the Los Angeles Times, the company owns six other daily U.S. newspapers. Tribune plans to focus on its more lucrative television business and hired Peter Liguori, formerly of Fox Broadcasting and Discovery Communications Inc., as its chief executive officer in January.
Rupert Murdoch, chairman and CEO of News Corp. (NWSA), plans to take a close look at Chicago-based Tribune Co.’s newspaper assets once they’re available, a person with knowledge of his thinking told Bloomberg News in December.
Murdoch, 81, has expressed interest internally at looking at some of Tribune’s bigger-market newspapers, according to the person. News Corp. is splitting into two companies, with one focused on entertainment and the other on newspapers and publishing. That latter company will start off with a debt-free balance sheet, which may give Murdoch more latitude to pursue newspaper acquisitions, the person said.
CNBC reported earlier yesterday that Tribune had hired the two banks.
Tribune Co. filed for bankruptcy in 2008, a year after billionaire real-estate developer Sam Zell orchestrated an $8.3 billion leveraged buyout of the company, just before a global recession and a slump in print advertising devastated the newspaper industry.
The buyout loaded Tribune with debt, and Zell failed to complete a turnaround of the newspapers. The bankruptcy triggered a court fight between bondholders who held Tribune’s pre-buyout debt and the lenders who funded the takeover. A settlement approved by the bankruptcy court allowed the older creditors to try to recover some of their losses by pursuing lawsuits against shareholders and managers, including Zell.
The company was valued at about $7 billion, including publishing, media and other assets, with $2.06 billion in cash, according to an April filing with the bankruptcy court.
The publishing group, which also includes the Baltimore Sun and Hartford Courant newspapers, is valued at about $623 million, $300 million lower than a January 2011 estimate.
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