K
KiRby
Guest
Except instead of a house its a giant newspaper company, and thousands of journalists at the Los Angeles Times, Chicago Tribune, Florida Sun-Sentinel and other papers stand to lose their jobs. Apparently Tribune's insane newspaper savior Lee Abrams is going to have to send even more rambling and pointess memos to get them and their advertisers out of the "fear/acceptance zone."
Bloomberg predicted all this, as usual, by listening to fancypants Wall Street analysts, with their attention to things like fiscal solvency and balance sheets and other things of zero interest to new media visionaries like Zell and Abrams.
Tribune paid off some debt by selling Newsday to Cablevision for $632 million. But it still needs more cash to avoid going into default, and several of its big ideas look dubious amid the economic meltdown: selling the Chicago Cubs (S&P is skeptical and Tribune delayed the sale , originally to come by the end of the year, until spring), issuing securities on the moribund commercial paper market and selling the properties now housing the LA Times and Chicago Trib (commercial real estate is in the toilet).
Driving this whole firesale mentality are continued declines in newspaper advertising, which Zell apparently didn't count on, and which radio-industry clown Abrams couldn't correct. Operating profits declined 83 percent companywide in the most recent quarter, according to the Journal.
Tribune's best hope at this point is that its lenders will decide the company is in better shape than most other distressed debtors and give it some breathing room, rather than lose all their money in bankruptcy. The lenders have supposedly been "amicable" with Tribune thus far, according to the WSJ, but demoralized empoyees won't be so forgiving the next time Zell comes around to cuss them out.
[IMG]http://www.pheedo.com/img.phdo?p=1[/IMG]