Tribune Co. Accepts Zell Bid; Will Shed Cubs

Real estate investor Sam Zell will acquire Tribune Co. and take it private in a deal valued at about $8.2 billion. The media company also owns the Chicago Cubs, but will sell the team after this season.

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RENEE MONTAGNE, host:

In today's business news, a media giant finds a buyer.

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MONTAGNE: The Chicago-based Tribune Company announced this morning that it has accepted a buy-out offer from real-estate magnate Sam Zell. If completed, the deal may finally usher in the next chapter for the troubled media company which owns 11 daily newspapers including the Los Angeles Times and the Chicago Tribune. But that's not all, the company also owns 23 television stations and the Chicago Cubs.

NPR media correspondent David Folkenflik has been following the story, and joins us now. Good morning.

DAVID FOLKENFLIK: Good morning, Renee.

MONTAGNE: This has definitely been long time coming. What finally made it, the deal, happen?

FOLKENFLIK: Well, I guess, you could say this is the least worst option; just for a few details, the company will valued at about $34 a share. Sam Zell's investing all of $315 million of his own money into a company that's valued a little less, I guess, with the market cap of about $8 billion plus a couple of billion in debt. This is the best they got, you know, he's able to leverage this using essentially a certain amount of employee shares. It's very complicated structure but this is the best offered they got after really tortured process.

MONTAGNE: Now, I'm at the Tribune's deal that they've just announced and it says that Tribune would be going private. What exactly does that mean?

FOLKENFLIK: Well, it means that they would probably be - or they would definitely be insulator from the daily vagaries of Wall Street, that is, they wouldn't have to appease so large investors for the question of their market share. That's something that a lot of people in journalism have kind of clamored for as a publicly traded companies that have been hit hard. But then again, you know, you don't know until it happens what kinds of financial dictates he'll make until he's in the chairman's seat.

MONTAGNE: And is this any sort of vote of confidence in the newspaper business?

FOLKENFLIK: Well, in an interview, Sam Zell has said that he's bullish on it, particularly in certain online ventures, the growth of online - Career Builder which Tribune owns a major share in it, says it's a big deal. He says he's bullish but, in fact, it's a fairly risky proposition, it's a bit of a gamble.

MONTAGNE: So according to press releases, am I reading this right, that the Tribune is selling the Cubs?

FOLKENFLIK: The Tribune company will no longer own the Chicago Cubs after this season. Many fans of Chicago have clamored for that for some years, and we'll see how that treats the team's fortunes.

MONTAGNE: David, thanks very much.

FOLKENFLIK: You bet.

MONTAGNE: NPR media correspondent David Folkenflik.

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