Tribune workers awaiting 2nd shoe

Questions abound in company drama

September 23, 2006|By Barbara Rose | Barbara Rose,Chicago Tribune

CHICAGO -- In Tribune Co.'s cafeteria yesterday, the day after a big board meeting set the company on course for a possible sale or breakup, the talk was about the Chicago Cubs, the weather, weekend plans.

But beneath the usual chatter at headquarters, and at Tribune-owned newspapers around the country, there was an uncomfortable sense that the stakes had risen measurably - and the timetable accelerated - in a corporate drama that would determine employees' jobs, their 401(k) plans and retirements.

"I can't remember a more unsettling, disturbing, gloomy time," said columnist Susan Reimer, who joined The Sun in Baltimore in 1979 when the newspaper was family owned, and has survived a succession of owners, publishers and editors.

In Stamford, Conn., at The Advocate, "Everybody is waiting for the other shoe to drop," said reporter Doug Dalena.

And at The Morning Call in Allentown, Pa., multimedia editor Chris Krewson starts his days trying to read the tea leaves in the latest Tribune-related news.

"Are we more or less likely to be sold?" Krewson asked rhetorically yesterday. "Do we fit their strategy? Should I update my resume?"

On Wall Street, investors plowed their money into Tribune Co. yesterday, bidding up the shares 6 percent the day after the media conglomerate announced it would consider a breakup or buyout of its assets.

The same news was greeted with gloom by bond investors who worried any restructuring would increase the likelihood that Tribune would default on its debt. Fitch Ratings and Standard & Poor's lowered their grades on the company's junk-debt another notch, expressing disappointment that the company wouldn't be focusing on paying off the billions it owes. Tribune debt already was rated non-investment grade, or junk, before yesterday's downgrades.

But Tribune's shares rose $1.94 to close at $33.99, their highest level since October 2005. Almost 7 million shares changed hands, triple the average volume.

Atul Choudhary, a database administrator at Tribune headquarters in Chicago, took it as a good sign that the stock popped up before he got to work yesterday. But he also understands the downside of Wall Street's rekindled interest. "That's the shareholder's value going up, not the employee's value," he said, adding, "People talk about how maybe they are going to outsource" his department.

At the Orlando Sentinel in Florida, where Tribune has more than 1,200 employees, checking Tribune's stock price is a ritual. Even when news is unsettling, not everyone frets.

"It's hard to imagine that change could be bad," said columnist Scott Maxwell, echoing the feelings of co-workers who have watched the company's stock flounder. "The general school of thought around here is that we're not really worried because we're profitable."

Resentment at Tribune's management has been particularly strong at the Los Angeles Times, where publisher Jeffrey Johnson appeared to set off a rebellion last week by backing up editor Dean Baquet, who defied Tribune bosses, seemingly refusing to cut more newsroom jobs. More than 400 editorial employees signed a letter to Tribune in support of Johnson and Baquet.

Among Tribune employees in Chicago, some cast a disparaging eye westward, toward the Times' former owners, the Chandler family, Tribune Co.'s largest shareholders.

The Chandlers' open dispute with Tribune management, raging since June as they tried to maximize the value of their stake, set the stage for the Tribune board's latest decisions.

"I feel like, what are these people doing meddling in our affairs?" said Bruce Tuszynski, a systems analyst at Tribune headquarters. "What the heck does a family in Los Angeles have to do with us? They're getting a great deal out of it at the expense of our value, the value of our company."

A 10-year Tribune employee, Tuszynski is working on a high-capacity data network connecting Tribune's Chicago and Los Angeles operations. Tribune's management has signaled that a sale of the Times is unlikely, despite pressure from Wall Street and Los Angeles civic leaders.

Yet Tuszynski is keenly aware a sale would scuttle his project. "All this work I'm doing could be torn out in six months, or shut down," he said.

Editorial employees feel particularly vulnerable. For instance, Tribune is reported to have considered selling The Morning Call.

"You don't know who else will have you," said Bill White, a columnist in the paper's Bethlehem, Pa., bureau and an employee since 1974. "There definitely is an unsettled feel- ing."

"We're all worried about job security," said Baltimore Sun assistant city editor Peter Hermann, a 16-year Sun employee. "We have Poynter [Institute, a media site] on our computer screens every day, and this morning, the stock ticker."

Longing for a benevolent owner vies with fear of the unknown. "My biggest concern is that the paper will be sold to a media company that is even more bottom-line-oriented than Tribune," said Dalena, The Advocate reporter. "But, on the other hand, my wishful thinking is that we would have the kind of interest from private investors who see the value in a newspaper as a public service, who might step up and preserve local journalism."

Staying focused can be hard, some employees said. "It's kind of a mind game," said Eileen Zaccagnino, advertising director for The Advocate and sister paper Greenwich Time. "We are expected to work extremely hard, keep moving forward, yet we don't know if it will all pay off."

Barbara Rose writes for the Chicago Tribune. Morning Call reporter Kurt Blumenau, Orlando Sentinel reporter Tim Barker, Sun reporter Jamie Smith Hopkins, Advocate/Greenwich Time Business Editor Jim Zebora and Tribune reporter Susan Chandler contributed to this article.

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