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http://www.nytimes.com/2007/04/02/business/media/02tribune.html?_r=1&ref=business&oref=slogin
Real Estate Tycoon Increases Bid for Tribune
By ANDREW ROSS SORKIN and KATHARINE Q. SEELYE
Sam Zell, the Chicago real estate tycoon, took another step toward winning the auction for the Tribune Company late last night when he agreed to raise his bid at the urging of the company's board, according to people close to the talks.
The board had indicated that if Mr. Zell were to make a high enough offer, it would be prepared to sell its 160-year-old media empire to him.
Mr. Zell had been outbid by the team of Ronald W. Burkle and Eli Broad, two Los Angeles billionaires, but the company seemed more eager to turn the company over to Mr. Zell. His offer is further along and could be finished more quickly, these people said. In addition, the board would prefer to sell the company to a Chicagoan like Mr. Zell, rather than to people with ties to Los Angeles, where disputes between Tribune and its largest newspaper, The Los Angeles Times, have been played out on the public stage.
Last week, Mr. Zell's bid of $33 a share, which he already increased once, had been $1 below the Burkle-Broad bid, which is valued at about $8.1 billion. On Friday afternoon, Tribune executives told Mr. Zell that he would have to offer them more money if he wanted to buy the company, the people said; Mr. Zell came back with a new bid of close to $34 a share.
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Tribune board weighs Zell's new offer By Michael Oneal and David Greising Tribune staff reporters Published April 2, 2007, 1:26 AM CDT
Tribune Co.'s board of directors negotiated late into Sunday night on a deal aimed at handing control of the 159-year-old Chicago Tribune and other major media properties to maverick Chicago billionaire Sam Zell for $13 billion.
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The fact that Tribune's auction dragged on for nine months with a dearth of serious bidders speaks volumes about how the rest of the world views the outlook for traditional media properties in an increasingly digital world.
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"The amount of debt Tribune is going to have blows my mind," said one of them, noting that he's expecting three years of cash flow declines as once-loyal advertisers rush to get online. "It seems very dangerous to me."
Many observers have speculated that Zell's only exit from the danger zone will be to continue the cost-cutting, job-slashing and asset-shuffling that has caused so much angst in the newspaper industry. snip