Tuesday, November 16, 2010

Sam Zell to Bow Out of Tribune


The Wall Street Journal

Tribune Co. Chairman Sam Zell said Monday that he doesn't see himself having an operating role in the media company after it exits bankruptcy.

"I think when we're done with the bankruptcy process I will turn it over to whoever the creditors decide they want to run it, and wish them a lot of good luck," Mr. Zell told CNBC in an interview.

Mr. Zell, a real-estate mogul, led an $8.2 billion leveraged buyout of Tribune in 2007. Creditors blame the deal for leaving the owner of the Chicago Tribune, the Los Angeles Times and cable TV station WGN insolvent, forcing it to seek Chapter 11 protection in late 2008.

Nearly two years later, the company remains stuck in bankruptcy proceedings as creditors have battled over the circumstances that led to the 2007 buyout. Late last month, the company filed a reorganization plan backed by its leading creditors, taking what it hopes is a final step toward exiting bankruptcy.

In the meantime, some of Tribune's leading creditors have been quietly working on finding new leadership to steer the company post bankruptcy. Among the candidates floated to replace Mr. Zell as chairman are former News Corp. executive Peter Chernin and former Walt Disney Co. Chief Executive Michael Eisner, according to people familiar with the matter. Creditors also have had informal discussions with recruiters about who might fill the CEO spot, the people said.

The CEO spot was vacated last month when Randy Michaels resigned after a string of unflattering revelations about the culture at Tribune under his leadership. The board created a four-person executive council to replace Mr. Michaels.

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