Tribune Co. Files For Bankruptcy
Tribune Co., owner of the Los Angeles Times, Chicago Tribune, Baltimore Sun and other dailies, filed for Chapter 11 bankruptcy on Monday, the first major newspaper publisher to take such a step since the Internet plunged the industry into a desperate struggle for survival.
The media conglomerate was smothered by a drop-off in advertising and a crushing $13 billion in debt from the company's takeover a year ago by Chicago real estate mogul, Sam Zell.
Chapter 11 would buy the Tribune Co. time to put its finances in order. Analysts say the company will almost certainly have to sell off some of its major holdings — and that could prove extremely difficult because of the bad economy and the poor outlook for newspapers.
"When you look at the near term, prospects for the company and the industry are certainly not very bright," said Dave Novosel, an Analyst with the Gimme Credit research firm.
Tribune Co.'s employees, who received an ownership stake in the company when Zell came in, could also see the value of their holdings wiped out. Tribune Co., which has 20,000 employees, owns baseball's Chicago Cubs as well as 10 daily newspapers, including The Hartford (Conn.) Courant and the Orlando (Fla.) Sentinel, cable channels and 23 TV stations. Its papers total circulation of more than two million puts the Tribune Co. among the top three most-read newspaper groups nation-wide. — AP