Each of the local billionaire media moguls-in-waiting — Eli Broad, David Geffen and Ron Burkle — sent separate letters to the Tribune Company board this month expressing interest in buying the Los Angeles Times. The board considered the letters at a July 19 meeting, after which CEO Dennis J. FitzSimons replied in writing that the Tribune board wasn't interested now — but never say never. The Times' Thomas S. Mulligan and James Rainey break the story on today's front page, and quote FitzSimons' reply that the board "unanimously asked me to advise you that at this time we are not prepared to discuss the possible transaction described in your letter. If our perspective changes we will contact you." The reporters write:
One person close to the situation, who spoke on condition of anonymity because the matter was confidential, said he considered FitzSimons' reply more hospitable than Tribune's previous posture, which was simply that The Times was not for sale.
A sale of The Times, arguably Tribune's single most valuable asset, would probably not occur except as part of a breakup or outright sale of Tribune, according to investors and analysts who follow the company. The presence of willing buyers for a number of Tribune properties, however, could increase pressure on the company to consider a breakup....
The board's unanimity in the July 19 meeting is significant because it came six weeks after a boardroom battle between FitzSimons and California's Chandler family, whose trusts control about 15% of Tribune shares — the largest single stake. Chandler representatives hold three of the company's 11 board seats.
Descendants of the family that founded The Times, the Chandlers last month publicly attacked management's plan to repurchase 25% of Tribune's stock and said the company should instead spin off its TV stations or put the company up for auction. With the Chandler directors opposed, the board voted 8 to 3 to go ahead with the stock buyback.
While the Broad-Geffen-Burkle talk advances beyond the rumor stage, here is some pure gossip: a source whose knowledge of the situation I can't vouch for says that the Tribune, Dean Singleton, Philip Anschutz, the Register and the Belo chain have all inquired about buying the South Bay Daily Breeze, which went on the market last month.
* At LA Biz Observed: Mark Lacter predicts Tribune will sell "likely within the next 12 months."
Previously on LA Observed:
Lining up to buy the Times
Geffen's interest in the Times