Tribune May Receive Offers From at Least Six Bidders
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Tribune Co., the second-largest American newspaper publisher, may receive offers from at least six bidders for all or part of the company.
Gannett Co. put in a preliminary offer, according to the Chicago Tribune, the company’s flagship newspaper. Maurice R. “Hank” Greenberg, former chairman of American International Group Inc., is also considering a bid, said a person familiar with his plans.
Mr. Greenberg and Gannett would add to bids from private equity firms Bain Capital LLC and Apollo Management LP and a joint offer from Californian billionaires Ron Burkle and Eli Broad. Chicago- based Tribune, with a market capitalization of $7.8 billion, has also approached News Corp., Hearst Corp., and Dean Singleton’s MediaNews Group Inc., the Wall Street Journal reported today.
“Everybody seems to be showing up,” an analyst at Benchmark Co. in NewYork, Edward Atorino, said. He has a buy rating on Tribune stock. “These are very attractive assets.”
The interest in Chicago-based Tribune’s assets, which include the Los Angeles Times and Chicago Cubs baseball team, has increased since Tribune indicated earlier this month that it would be willing to sell the company in pieces, rather than as a whole. The Tribune’s chief executive officer, Dennis FitzSimons, and other directors agreed in September to consider selling the company after pressure from its largest shareholder, the Chandler family.
Shares of Tribune, also owner of the Chicago Tribune and 25 television stations, are down 34% in the past three years as Mr. FitzSimons failed to stem the defection of readers and advertisers. The shares rose 46 cents, or 1.4%, to $32.49 at 11:49 a.m. in New York Stock Exchange composite trading.
Tribune spokesman Gary Weitman declined to comment on interest from potential buyers.
“Tribune has been unable to get an attractive price for the company as a whole, so they’re looking to shed some newspapers and television stations,” a managing partner at MediaTech Capital Partners in New York, Porter Bibb, said. “With so many parts potentially for sale, this is going to be a long and drawn out process.”
The bids from investors such as Mr. Burkle’s Yucaipa Cos. and Mr. Broad’s investment firm helped revive a sale process that slowed after bids from private equity companies came in below the company’s projections. Movie mogul David Geffen also expressed interest in buying Tribune earlier this year.
Boston’s Bain and New York’s Apollo offered about $32 a share, giving no premium to the company’s stock market value. Bids also came from a group consisting of Thomas H. Lee Partners LP, also based in Boston, and Fort Worth’s Texas Pacific Group. Apollo was joined in its bid by Madison Dearborn Partners LLC of Chicago and Providence Equity Partners Inc., based in Providence, Rhode Island.
McLean, Virginia-based Gannett, the largest American newspaper owner and publisher of USA Today, would be the first newspaper company to join the bidding. As well as concerns about the tax bill for Tribune associated with selling individual assets, Gannett may be blocked by media ownership rules.
“Gannett is not a big-city newspaper publisher, it’s out of character for them,” Mr. Atorino said. “They may be looking at pieces, certainly the broadcasting.”