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Posts Tagged ‘Sam Zell’

Tribune Company Bankruptcy Proceedings Finally Underway

After more than two years of backroom negotiations, the Tribune Company bankruptcy case finally got underway in court yesterday. Bankruptcy judge Kevin Carey is now faced with choosing between two rival plans. One, backed by the Tribune Company, would essentially shift the company’s debt, and assets, into the hands of lenders like JPMorgan Chase. The other, backed by Aurelius Capital Management, would take a more aggressive stance toward getting funds from those who pushed Tribune Company‘s leveraged buyout–namely Sam Zell. (Zell isn’t a fan of either plan, apparently, because both leave the option open to sue him and his company Equity Group Investments.)

However, during yesterday’s opening statements, Carey let everyone know that after two years of negotiations, he still retained the option to reject both plans.

“What then?” he asked rhetorically, not allowing either side a response.

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LA Times Editor Responds to the NYT’s Ill-Timed Sideswipe

Like most of the LA media world, ourselves included, LA Times editor Geoffrey Mohan was not impressed with the New York Timesextremely belated piece on the struggles at the LA Times under Tribune Company ownership. So he decided to let the NYT know about his displeasure, penning a letter to the paper that he CC’d to Romenesko and the Columbia Journalism Review.

A taste:

I was shocked today (1/24/11) to find there are people who gripe about the good old days in Los Angeles, and I thank the New York Times for visiting our city to tell us they were here. Equally, I thank you for couching your astonishing discovery with dismissals of the late accomplishments of the bemoaned Los Angeles Times.

“Never mind,” Jeremy Peters instructs, that “The [Los Angeles] Times is considered a front-runner to win a Pulitzer Prize this year for its coverage of city officials in Bell who gave themselves enormous salaries, a story that tapped into a growing national outrage over wasteful government spending.

“Or that it still maintains, despite all the bloodletting since the paper was bought in 2000 by the Tribune Company, 13 foreign bureaus, more than any other large metropolitan daily except The Washington Post.

“Or that it is the only big-city daily that still employs a battalion of correspondents stationed in cities across the country.

What matters, apparently, is that a 66-year-old merchant in a “quaint” neighborhood misses “the old Hollywood starlets and socialites who graced the society pages.” For that, we are not the “world-class paper” that we used to be.

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New York Times A Couple of Years Late Reporting On the LA Times’ Struggles

The New York Times ran an extremely belated piece today on the struggles at the LA Times. Thanks to the Grey Lady we learn that since the Tribune Company took control of the LA Times, half the newsroom positions at the paper have been cut and the paper shut down its Orange County plant. Which is a bit like telling us Obama was elected president. We figured that one out quite some time ago.

LA Observed‘s Kevin Roderick says he was contacted for the piece over a month ago by reporter Jeremy Peters.

I never was quite clear on [Peters] rationale for writing that story now. I think my quip was that it seemed more like a peg for 2008. After reading his piece in Monday’s NYT, I’m still not sure why now.

Couldn’t agree more. News has been quiet on the LAT front since the LATExtra “innovation.” In fact, things seem to be looking up–no more Randy Michaels, all indications are Sam Zell wants nothing more to do with the print business, the paper is profitable. Sorry, Gray Lady, think you blew it on this one.

Columbia Journalism Review: Tribune Company Has ‘No Plausible Reason’ to Continue Running the LA Times

In a sentiment that we’re sure echoes kindly in the certain Spring Street corridors, Columbia Journalism Review‘s Charles M. Madigan argues, essentially, that the Reaganomics model of journalism–massive, more-with-less, bottom-line driven, publicly-traded media companies–needs to stop, in favor of private local control. Namely, the Tribune Company (and some other media monoliths too) need to shed their assets, go private, and focus on their local communities. Let Chicago do Chicago and let LA do LA.

There is no plausible reason anymore for Tribune to be running publications in Los Angeles, Baltimore, Florida, Pennsylvania, or anywhere but Chicago. The arguments about synergies and efficiency and gigantic advertising footprints have all collapsed. They were strategies that made sense in an era that ended a decade ago.

People in those places despise you. They cannot wait for you to fail. They wish you only ill. No one can be a worker focused on customers in that atmosphere. Their days will be consumed by rumors of cuts to come and resentments of cuts already accomplished.

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Tribune Company COO Gerry Spector Steps Down

The Chicago Tribune‘s “Tower Ticker” blog is reporting Tribune Co. COO and Sam Zell pal Gerry Spector is stepping down at the end of the year. Chicago Tribune Media Group CEO Tony Hunter, LA Times publisher Eddy Hartenstein, Tribune Co. Chief Investment Officer Nils Larsen and Chapter 11 caretaker Don Liebentritt made a joint announcement yesterday.

“Gerry has been an important part of our success, and he has been a tireless champion of efficiency and innovation across the company,” the group said in a statement.

Don’t you just love that word efficiency? Which, ever since the advent of Reaganomics, is business speak for “layoffs.” We’re not just making that up. Given what the LA Times has been through in the past few years, doesn’t it make more sense? Spector was a “tireless champion of layoffs.”

Anyway, aside from laying people off, Spector also had an apparent fetish for Cosby sweaters. So, there’s that too.

What’s that saying about the door hitting something on the way out…?

Sam Zell Will Likely Be Sued by the End of the Day

The New York Post is reporting that by midnight tonight, a group of Tribune Company lenders are expected to sue Sam Zell for his role in the leveraged buyout of that company, which precipitated its collapse.

More from the Post:

Lawyers for the lenders, who are racing a Wednesday deadline to get the charges filed, will allege, sources said, that Zell’s Tribune took on too much debt and made the company immediately insolvent.

Any recoveries from the Zell suit will be combined with the proceeds, if any, from related cases and will be placed in a litigation trust to be paid out to creditors, a person close to the situation said.

If filed, the lawsuit comes just weeks after Zell’s lawyers oddly tried to convince bankruptcy judge Kevin Carey to warn lenders not to sue. Carey complied–although if the Post is right, looks like it didn’t matter much.

Previously on FBLA: Sam Zell Doesn’t Want to Be Sued: Good Luck With That

Sam Zell Doesn’t Want to Be Sued: Good Luck With That

Lawyers representing Sam Zell in the Tribune Company‘s bankruptcy case have asked Judge Kevin Carey to warn creditors not to sue him–or “they’ll lose.”

The Wall Street Journal‘s Peg Brickley explains in semi-legalese:

Zell’s request is couched as an objection to the reports creditors will see when they get their ballots to vote on the four competing reorganization proposals for the newspaper publisher and broadcaster. Before the ballots go out, Judge Kevin Carey must find the materials describing the various Chapter 11 plans to the voters contain “adequate information.”

Zell’s objection says it’s not adequate to tell creditors that Tribune’s banks and bondholders and trade creditors all want to sue him. It will only be adequate to tell them that if they sue, they will lose, in the opinion of Zell’s attorneys.

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Zell Has Tribune Exit Strategy In Place

Chairman Sam Zell is finally walking away from the professional and financial firestorm known as Tribune.  Since buying the company in 2007, Zell has seen Tribune undergo everything from bankruptcy filings to a sexually charged email written by a “frat boy” executive.  In an interview with CNBC last night, Zell announced that he will be stepping away from Tribune and “doesn’t envision having any role going forward.”

Referring to the Tribune purchase as “the deal from hell,” Zell made it clear that he wishes to wash his hands of the whole situation:

“As soon as the bankruptcy proceedings are done, I’ll turn it over to whoever the creditors decide they want to run it.”

Tribune Company Has Spent $135 Million on Bankruptcy, Creditors Allowed to Sue Sam Zell

The Tribune Company submitted a new proposal to exit Chapter 11 protection on Friday, and some mighty interesting factoids were revealed in the filing. Among other tidbits, it was revealed the Tribune Company has spent $135 million in bankruptcy-related fees.

Hmmmm, wonder how many LA Times staff positions can you save with $135 million…

Also decided on Friday, bankruptcy judge Kevin Carey said he would allow creditors to sue Sam Zell, Tribune executives, advisers and, reports the Chicago Tribune, “other architects of the ill-fated leveraged buyout after Tribune Co. restructures. Junior creditors have charged that the two-step transaction, which was led by Zell, was a case of fraudulent conveyance, meaning it left Tribune Co. insolvent from the start.”

Also from the Tribune, in the wake of the resignation of CEO Randy Michaels, an apology to its readers for its morally bankrupt corporate culture.

[Our executives] conduct has embarrassed us in front of our readers, our advertisers, our business partners and our families. It has left us answering questions about whether reports of their actions reflect the environment in which we work. We want to tell you that Chicago Tribune employees, including those who work in our newsroom, don’t conduct themselves in the manner attributed to some Tribune Co. executives.

The New York Times Details Tribune Company ‘Frat House’

Wow. Quite a piece by David Carr in the New York Times detailing the transition from the pre-Sam-Zell conservative Tribune Company to what Carr describes as a “frat house.” Carr delves into widespread sexual harassment within the company as well as  obscene executive bonuses that were doled out as management laid off hundreds of journalists throughout the company.

At a time when the media industry has struggled, the debt-ridden Tribune Company has done even worse. Less than a year after Mr. Zell bought the company, it tipped into bankruptcy, listing $7.6 billion in assets against a debt of $13 billion, making it the largest bankruptcy in the history of the American media industry. More than 4,200 people have lost jobs since the purchase, while resources for the Tribune newspapers and television stations have been slashed.

The new management did transform the work culture, however. Based on interviews with more than 20 employees and former employees of Tribune, Mr. Michaels’s and his executives’ use of sexual innuendo, poisonous workplace banter and profane invective shocked and offended people throughout the company. Tribune Tower, the architectural symbol of the staid company, came to resemble a frat house, complete with poker parties, juke boxes and pervasive sex talk.

Bravely, LA Times star columnist Steve Lopez went on record for the piece.

“You have advertising wrapping around sections and being disguised as news and empty desks all around you, and then you read about these ridiculous bonuses and feathering their nests with severances, you want to scream.”