— Tribune Co. announced its intent to pursue
the separation of its broadcasting and publishing businesses into
two distinct companies. Tribune said this proposed separation is intended to maximize shareholder value
through the spin-off of Tribune’s publishing assets to an independent
company and the tax-free distribution of shares in that company to Tribune stockholders. The company announced last week that it entered into an agreement to acquire
Local TV Holdings and the 19 television stations it owns in 16 markets
across the country.
The two companies that would exist following
the separation would be:
Tribune Publishing Co., comprising Tribune’s publishing assets, including the Los Angeles Times, Chicago Tribune, The Baltimore Sun, Sun Sentinel (South Florida), Orlando Sentinel, Hartford Courant, The Morning Call and Daily Press.
Tribune Co., comprising the other
principal businesses, including 42 local television stations in 33
markets (following the close of Tribune’s acquisition of Local TV), WGN
Radio, superstation WGN America, Tribune Studios, Tribune Digital
Ventures, Tribune Media Services, its equity interests in Classified
Ventures, CareerBuilder, and The TV Food Network, and its valuable
portfolio of real estate assets.
Over the last several months, Tribune’s board of directors and
management team evaluated a variety of strategic options intended to
maximize shareholder value and position the company for long-term
growth. As a result of this process, the board has authorized
management to pursue the separation of the company’s primary lines of
business, broadcasting and publishing.
During the next nine to a year, Tribune’s management team
plans to develop detailed separation plans for the company’s board of
directors to consider. Upon the closing of the proposed transaction,
each entity—Tribune Publishing Co. and Tribune Co.—will have
its own board of directors and senior management team.
The completion of Tribune’s separation into two companies is subject
to a number of conditions, including the receipt of regulatory
approvals, opinions from tax counsel, further due diligence and the
effectiveness of appropriate filings with the U.S. Securities
and Exchange Commission. While Tribune intends to pursue the
separation of its broadcasting and publishing businesses, there can be
no guarantee that the transaction will be concluded or assurances as to