US media giant considers bankruptcy

US media giant considers bankruptcy
Mon, 08 Dec 2008 06:26:44 GMT

Tribune Company, owner of the Los Angeles Times and Chicago Tribune, other newspapers and the Chicago Cubs and Wrigley Field.
Tribune Co. - the US publisher, broadcaster and owner of the LA Times and Chicago Tribune - is preparing to file for bankruptcy protection.

Cash flow difficulties have prompted media speculation that the prestigious US broadcaster and publishing house may not last another week.

The Chicago Tribune reported Sunday that its parent company has hired investment bank Lazard Ltd. and law firm Sidley Austin to help the company to decide its fate.

The newspaper quoted Tribune Co. spokesman Gary Weitman as saying, "It's an uncertain and difficult environment … We haven't made any decision. We're looking at all of our options."

Tribune's financial situation has been unsteady since December 2007, when it was bought out for $8.2 billion by real estate mogul Sam Zell.

The deal left the company with massive debts, and it now faces interest payments of almost $1 billion dollars according to a report in the Wall Street Journal.

The Tribune Company, which owns 23 television stations and 12 newspapers, has cut operational costs and is trying to sell assets such as the Chicago Cubs baseball team to pay off its debt.

DB/CW/DT

http://www.presstv.com/detail.aspx?id=7 ... id=3510213

I hope they go out of business and illegal squatters move into their former buildings!!

Just heard that the New York Times mortgaged their Manhattan building for $200 million. Advertisers are not advertising because they are losing money, and people are not willing to put out the dollar for the hard copy or renewing their subscriptions. TV news, as crappy as it is, and the Internet have supplanted newspapers thrown in the driveway.

Quote:

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Originally Posted by Bowman

I hope they go out of business and illegal squatters move into their former buildings!!

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Bowman you in great form :lol: :lol: :lol:

Tribune Co. files for bankruptcy protection
Owner of Chicago Tribune, L.A. Times, Chicago Cubs has $13 billion in debt
The Associated Press
updated 2:32 p.m. PT, Mon., Dec. 8, 2008

NEW YORK - Media conglomerate Tribune Co., smothered by $13 billion in debt and weak prospects for generating cash through advertising, on Monday became the first major newspaper publisher to seek bankruptcy protection since the Internet began siphoning readers from traditional outlets.

Although Tribune's next major principal payment on the debt, of $593 million, isn't due until June, has been in danger of missing lender-imposed financial targets at year's end. Those targets are based on the level of Tribune's debt relative to its cash flow, and become harder to meet as revenue declines, even if the debt itself doesn't increase.

Other newspaper companies have also struggled with their debts, but many have successfully negotiated with lenders to ease their targets in exchange for higher interest rates.

"Tribune's debt was so outsized and so disproportional to its cash flow compared to these other companies that it can be the sore thumb sticking out rather than an example of the industry," said Ken Doctor, media analyst with Outsell Inc.

The Tribune owns the Chicago Cubs baseball franchise, as well as the Los Angeles Times, Chicago Tribune, The Sun of Baltimore, The Hartford (Conn.) Courant, six other daily newspapers and 23 television stations. Most of the company's debt comes from the complex transaction in which the company was taken private, with employee ownership, by real estate mogul Sam Zell last year.

To make a payment this year, Tribune sold the Long Island daily Newsday to Cablevision Systems Corp. for $650 million.

To generate additional cash, the Chicago-based company has been looking to sell the Cubs, Chicago's storied Wrigley Field and the company's 25 percent stake in a regional sports cable channel. But a tight credit market has made it tougher for potential buyers to obtain loans.

And while Tribune had planned on meeting its obligations with lenders through income at its various properties, the recession has led consumers and advertisers to severely cut spending this year, exacerbating pressures the industry already was facing because of the migration of readers to the Internet.

"So, how did we get here? It has been, to say the least, the perfect storm," Zell wrote in a memo to employees. "A precipitous decline in revenue and a tough economy have coupled with a credit crisis, making it extremely difficult to support our debt. All of our major advertising categories have been dramatically impacted."

Monday's filing, made in bankruptcy court in Delaware, could give Tribune time to raise cash by waiting until the credit market eases to sell off assets. It also could put additional pressure on its lenders to ease the financial targets that Tribune must meet.

The company entered court protection with $13 billion in debt and $7.6 billion in assets.

Zell said the company's operations will function as before during the bankruptcy protection period. He also said in his memo that the Cubs franchise is not part of the bankruptcy filing. The Cubs issued a separate statement saying that the timetable for a sale has not changed.

John Penn, a partner who specializes in bankruptcy at Haynes & Boone LLP, said the Tribune's decisions about whether to sell papers or other assets would boil down to one issue: "If it makes cash, keep it. If it loses cash, get rid of it," he said. "And that's either by selling it, closing it or whatever it takes to stop the bleeding."

Tribune's biggest unsecured creditors are its lenders, led by JPMorgan Chase Bank and Merrill Lynch Capital Corp. JPMorgan is the administrator of $8.57 billion in senior debt and holder of about $1.05 billion of that. Others include Deutsche Bank AG, New York-based investment management firm Angelo Gordon & Co. LP, hedge fund Highland Capital Management LP and Goldman Sachs Group Inc.

Barclays Capital Inc., which bought key assets from Lehman Brothers Holdings Inc., is also among Tribune's creditors, with about $142.9 million in interest rate swaps.

Media industry players were also listed among the creditors. Warner Bros. Television is owed $23.7 million, Twentieth Television Inc. $8.1 million, Buena Vista Entertainment Inc. $6.2 million and NBC Universal Domestic Television $4.9 million.

http://www.msnbc.msn.com/id/28101775/?GT1=43001

This means the illegal alien who delivers my LA Times will lose his job it's
bad carma all around.

It's about time the propaganda machine, I mean the news media in print have now got their backs against the wall. They deserve what they get. They have chosen to be on the side of global communism, and it's beginning to backfire on them all bigtime. They are going the way of the dinosaur, as they should. They got too big, and too corrupt. And for their thransgressions, they are going to ultimately pay the price for them.