Results of Tribune tender offer due


Tribune Co., the owner of the Chicago Tribune, Los Angeles Times, Newsday and The Sun, will announce today the results of a tender offer to buy back about 25 percent of its shares. The offer was bitterly resisted by the Chandler family, the company's second-largest shareholder, which wants Tribune to spin off assets or sell the whole firm.

Gary Weitman, a spokesman for Tribune, would not discuss the auction's progress yesterday. But he said that before markets open today, the company would disclose how many shares were tendered in the offer, and the price it would pay.

The offer, announced May 30, was seen as an effort to boost Tribune's stock price and help fend off the type of investor pressure that recently led to the breakup of media company Knight Ridder Inc. The buyback offer ended at midnight yesterday.

In what is known as a Dutch auction tender offer, Tribune asked shareholders the price at which they would be willing to sell within a given range, in this case from $28 per share to a maximum of $32.50. The company will offer the lowest price needed to buy all the shares it wants.

Tribune has said it wants to acquire up to 53 million shares, but the offer wasn't conditional on a minimum number being tendered, according to documents filed with regulators.

After reaching a three-month high of $32.51 on June 15, Tribune stock closed at $30.90 yesterday.

A number of analysts said they didn't know what implication, if any, the stock's performance yesterday had for the price that Tribune would have to pay to get the shares it wants. But Scott Benesch, a media analyst at U.S. Trust Co. in Manhattan, said investors might be willing to sell below the top of the auction's range because they are worried about Tribune's long-term prospects, and particularly about the $2 billion the company borrowed to buy the shares.

Benesch said he recommended that U.S. Trust, which owned about 307,800 shares of Tribune as of March 31 on behalf of investors, tender at least some of those shares in the Dutch auction. Two other institutional shareholders of Tribune, however, said yesterday they wouldn't tender their shares because they considered $32.50 too low.

John Miller, senior vice president for Ariel Management, which owns about 5.2 percent of outstanding Tribune shares, or 15.7 million shares, said Tribune has a higher value if it is broken up, or if the shares are valued according to the company's discounted cash flow.

Robert Torray, chairman of Torray LLC, which recently increased its Tribune stake to about 2.7 million shares, said Tribune has "fantastic assets" and that its earnings are bound to improve.

Susan Harrigan writes for Newsday.

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