Continue reading Media World: Now some newspapers are looking for bailouts

Media World: Now some newspapers are looking for bailouts originally appeared on BloggingStocks on Thu, 29 Jan 2009 14:15:00 EST. Please see our terms for use of feeds.

Mark Cuban to Sam Zell: Sell me the Chicago Cubs at a discount originally appeared on BloggingStocks on Wed, 07 Jan 2009 09:09:00 EST. Please see our terms for use of feeds.

I guess I'm a bit old school, but I like the idea of walking to my mailbox to get my newspaper. I even like the feel of the ink that bleeds onto my fingers, but I recognize that I'm a bit unique.

Too unique, actually, and that is a problem for the newspaper business.

Yesterday, we learned that the old Tribune Company, privately owned by billionaire Sam Zell, is filing for protection under bankruptcy law. The company is drowning in a sea of debt and trying frantically to sell assets in order to raise cash.

It is obvious to management that subscriptions and advertising revenue will not be enough to pay off debt. The company will need to work with creditors on delaying principle and interest payments while it raises cash.

With the advent of the Internet and explosion of cable news networks, little old print media is going the way of the buggy whip.

Across the newspaper business, circulations have been falling for many moons and advertising dollars are taking their business elsewhere. Losses have been piling up, making it difficult to pay down debt used to consolidate the industry.

It's a complete mess.

Continue reading Tribune files for bankruptcy, could New York Times be next?

Tribune files for bankruptcy, could New York Times be next? originally appeared on BloggingStocks on Tue, 09 Dec 2008 17:50:00 EST. Please see our terms for use of feeds.

MAJOR PAPERS:

• The Wall Street Journal reported that a spokesperson for New Corporation (NYSE: NWS) said the company has dropped out of the bidding for Tribune Co's (NYSE: TXA) Newsday. This leaves Cablevision Systems Corporation (NYSE: CVC) as the apparent winner of the auction.
• According to people familiar with the matter, the Wall Street Journal reported that American International Group Inc's (NYSE: AIG) airplane-leasing unit is considering a split from the company. The people said International Lease Finance Corp have grown "increasingly concerned" the company will be hurt by AIG's financial troubles.
• Royal Dutch Shell Plc (NYSE: RDS.A) and Spain's Repsol YPF SA (NYSE: REP) are pulling out of one of Iran's biggest gas projects, the $10B-plus development of phase 13 of South Pars, the world's largest gas field, the Financial Times reported.

• Bloomberg reported that HSBC Holdings Plc (NYSE: HBC) set aside a smaller-than-forecast $3.2B for bad loans in the U.S. The bank also said its Q1 profit was higher than Q107.

Newspaper wrap-up: HSBC's allowance for bad U.S. loans is lower than expected originally appeared on BloggingStocks on Mon, 12 May 2008 08:00:00 EST. Please see our terms for use of feeds.

Well, with Topix, things are different. The site is categorized by ZIP codes and is chock-full of local stories. More importantly, users can post their own stories and links. In other words, anybody can essentially be an editor.

"A key is allowing the community to do its thing," said Chris Tolles, the CEO of Topix, in an interview with me. "Our site gets about 110,000 comments per day. Keep in mind that the Craigslist gets about 70,000 per day."

Continue reading Topix: Where everyone's a news editor

Topix: Where everyone's a news editor originally appeared on BloggingStocks on Wed, 19 Mar 2008 18:00:00 EST. Please see our terms for use of feeds.

Continue reading Tribune Company buyout finalized, no word on the Cubs

Tribune Company buyout finalized, no word on the Cubs originally appeared on BloggingStocks on Fri, 21 Dec 2007 10:52:00 EST. Please see our terms for use of feeds.

Continue reading Cramer on BloggingStocks: Three tests for financial stocks

Cramer on BloggingStocks: Three tests for financial stocks originally appeared on BloggingStocks on Wed, 14 Nov 2007 09:17:00 EST. Please see our terms for use of feeds.

Media owners have been chomping at the bit to be able to own both a TV station and a newspaper in the same city. Two major deal makers - Samuel Zell, a Chicago investor who is leading the charge to take the Tribune Company (NYSE: TRB) private, and Rupert Murdoch, Chairman and CEO of News Corp. (NYSE: NWS) who has tried for years to change the rule so he can continue to control both the New York Post and the Fox television station in New York -- hope it happens soon. If the rules change for Zell, he'll be able to own TV stations and newspapers in five cities - New York, Los Angeles, Hartford and the Miami-Fort Lauderdale area.

Well they may get their wish if Federal Communications Commission Chairman Kevin Martin has anything to say about it, according to the New York Times. The Times reports that Martin plans to repeal the decades-old media rule forbidding companies from owning both a newspaper and a TV or radio station in the same city. Right now an $8.2 billion buyout of the Tribune Company is hanging in the balance. Zell wants to take the company from a public to a privately held company by its employees, but the rule is in the way of completing the deal.

Continue reading Rupert Murdoch may get to own TV stations and newspapers in same city

Rupert Murdoch may get to own TV stations and newspapers in same city originally appeared on BloggingStocks on Thu, 18 Oct 2007 08:10:00 EST. Please see our terms for use of feeds.

Continue reading Tribune may sell Cubs, Wrigley Field separately

Tribune may sell Cubs, Wrigley Field separately originally appeared on BloggingStocks on Mon, 17 Sep 2007 16:00:00 EST. Please see our terms for use of feeds.

Much of the one-day panic about the market was driven by the fear that falling housing prices will hurt consumer confidence. One aspect of that is accurate. As variable rate mortgages reset, people may lose their homes. Unless, of course, the problem become so wide-spread that banks or the Fed decide that mortgage payments need to be underwritten so that homeowners keep their places and the market is not flooded with cheap real estate.

Another reason that investors are worried is the private equity debt is becoming more expensive. Some of the deals for companies like Chrysler or The Tribune Company (NYSE: TRB) could fall apart. The other side of that worry is that banks may pull out of the largest and most risky deals. That could cause lawsuits, but save financial institutions from billion dollar loses. It could also take the prices of some stocks that were in the takeover pool down. But, a stock that KKR wanted to buy at $100 may be attractive to investors at $80.

Shareholders who have stocks that have done as well as the S&P 500 over the last two years are up 20%. And that does not include dividends. Those stocks may be worth less than they were a week ago. But, if they have not been sold, that really isn't important.

The current market may be an ugly business for day traders, but it may give them a break from sitting in their basements in the dark all day.

They just might be scared out into the sunlight.

Douglas A. McIntyre is a partner at 24/7 Wall St.

The market: you can't lose what you don't sell originally appeared on BloggingStocks on Fri, 27 Jul 2007 12:39:00 EST. Please see our terms for use of feeds.

Tribune gets subprime financing for buyout originally appeared on BloggingStocks on Fri, 25 May 2007 12:45:00 EST. Please see our terms for use of feeds.

The sale of the Tribune Co, (NYSE: TRB) seemed to take forever (the process took about ten months). Then again, the newspaper industry continues to sag.

That's why it took the financial imagination of deal maestro, Sam Zell, to get the deal done.

The price tag for the Tribune comes to $34 per share or about $8.2 billion. That is about 10X EBITDA, which is a pretty good valuation.

To finance the deal, Zell is using a leveraged Employee Stock Ownership Plan (ESOP). That is, he will borrow a huge amount of money and have employees vest into the stock over time.

A big attraction is the significant tax benefits. First, the interest and principal is deductible on the debt. Next, owners of the Tribune's stock may be able to rollover their holdings into other stocks or bonds - and avoid paying capital gains tax. Also, by being converted to an S Corporation, the Tribune might be able to exempt some of its profits from taxation.

Another benefit is that the employee ownership should be an incentive for the workers.

On the other hand, if the Tribune's business weakens over the next few years, it could be a big hit to the personal balance sheets of employees - and that, of course, would not be so good for morale.

Just look at the ESOP at UAL Corp(NYSE:UAUA). It turned out to be a disaster because industry fundamentals fell to pieces and the company finally had to declare bankruptcy.

Tom Taulli is the author of various books, including the Complete M&A Handbook and the EDGAR-Online Guide to Decoding Financial Statements.

Tribune gets creative with a "leveraged ESOP" originally appeared on BloggingStocks on Tue, 03 Apr 2007 11:08:00 EST. Please see our terms for use of feeds.

Ben Berkowitz is the business news editor for AOL. His weekly column looks at news stories with long-term significance that were initially overlooked.

The story you didn't read this week but should have is the almost off-handed way that super-billionaire Sam Zell said he'd perhaps like to buy Tribune Co. (NYSE: TRB). And if that wasn't enough, now everyone's favorite even-bigger billionaire Warren Buffett is said to be snapping up shares of the New York Times Co. (NYSE: NYT).

These titans of industry understand something that even the Internet has not changed: owning a newspaper is both a mark of prestige and an easy way to have a very loud voice. Anyone who thinks their motives are altruistic has perhaps been sniffing too much newsprint.

Sam Zell is a real-estate baron. What on earth would he do with a newspaper chain? (Yes, Trib also owns the Cubs, and some TV stations, and a few other properties, but the same question applies. There are easier ways to own a baseball team.)

Keep asking: why does housing developer and art patron Eli Broad want the Los Angeles Times? Or supermarket magnate Ron Burkle? Why would insurance heavyweight Hank Greenberg want the New York Times? Why does Jack Welch want the Boston Globe? Hint: remember the rumors about Welch trying to steer election coverage in various NBC newsrooms in 2000.

Simple: they want to control mainstream media outlets to push their agendas. Broad has a vision for changing the future of Los Angeles. Burkle is a big Democratic supporter. Greenberg has been abused mercilessly in the press for the financial doings at AIG. Welch's wife is a journalist.

The motives for Zell and Buffett are less clear; maybe Zell wants to take a crack at Trib for the sake of it? Great businessmen love challenges. And Buffett, well, just do what the man says. He buys it, you buy it. Really, he didn't get rich on his looks or fashion sense.

Continue reading The Story You Didn't Read: Moguls go newspaper crazy

The Story You Didn't Read: Moguls go newspaper crazy originally appeared on BloggingStocks on Fri, 09 Feb 2007 15:44:00 EST. Please see our terms for use of feeds.

Tribune (NYSE:TRB) opened today at $30.92. So far, the stock has hit a low of $30.71 and a high of $31.05. As of 9:59 this morning, TRB was trading at $30.93, up $0.01 (0.03%) on extremely heavy volume.

After hitting a one year low of $27.09 on April 6, 2006, the stock worked its way up to a high of $34.28 on October 26, 2006. Tribune reported earnings yesterday all seemed positive as the company rode cost controls and non-operating gains to an 81 percent rise in fourth-quarter profits but said advertising, circulation and total revenues all declined excluding the benefit of an extra week in the period.The technicals for TRB have been improving lately and S&P gives the company a cautious 3 STAR (out of 5) hold rating with a current 12-Month target price of $34.

For a neutral to bullish hedged play on Tribune, I would consider an August covered call at the $30 level. There may even be a chance to pick up some of this stocks 2.3% annual dividend.

Vic Schiller is an analyst on the move at Investors Observer. (Free Subscription)

DISCLOSURE NOTE: Mr. Schiller owns and/or controls diversified portfolios of long and short stock and option positions that may include holdings in companies he writes about.

Check out some other earnings reports that we're following, and let us know what you're expecting.

Tribune rides cost controls originally appeared on BloggingStocks on Fri, 09 Feb 2007 11:43:00 EST. Please see our terms for use of feeds.

As I wrote yesterday on BloggingStocks, the rumor was that private equity firms had little interest in Tribune Co. (NYSE: TRB).

The good news is that there are a lot of billionaires in the US -- some of whom would like Tribune, or at least a piece of it. In fact, there are now at least two offers for the company.

First, Tribune's biggest shareholder, the Chandler family, whose ancestors created the Los Angeles Times, is offering about $31.70 per share. It's a funky deal, which includes $19.30 in cash and a planned spin-off of the broadcasting assets.

With a 20% equity stake, Chandler certainly has leverage.

The other offer comes from two California billionaires, Eli Broad and Ron Burkle. Their offer is also funky. They are willing to invest $500 million in the company and borrow $10.5 billion to pay a big dividend to shareholders. It's basically a leveraged recapitalization transaction.

In some ways, this represents further validation of the deep troubles in the newspaper business. On the news of the offers, Tribune's stock is up $0.55 to $30.89.

Tom Taulli is the author of various books, including the Complete M&A Handbook and the EDGAR-Online Guide to Decoding Financial Statements.

Tribune's billionaire bonanza originally appeared on BloggingStocks on Thu, 18 Jan 2007 11:27:00 EST. Please see our terms for use of feeds.