Chicago real estate mogul Sam Zell has become the favored suitor for Tribune Co. - owner of 11 daily newspapers, 23 television stations and the Chicago Cubs - with a $33-a-share bid that offers a clear premium for a company that has been buffeted by new media challengers, according to a person familiar with the negotiations.
Investment bankers are working feverishly to try to strike a deal, but so many details remain to be resolved that the company might not be able to meet its self-imposed deadline to conclude deliberations by the end of the month, the person familiar with the negotiations said. It's possible that the Chicago media company will opt, instead, to reorganize itself and pay shareholders a large dividend.
Zell would join with an employee stock ownership plan that he would form to make the offer, a $2.47 advance over the company's closing share price yesterday of $30.53, the source said. A committee of corporate directors received details of the Zell proposal Wednesday evening.
Tribune newspapers include the Chicago Tribune, The Sun, the Los Angeles Times and Newsday. Tribune Co. also owns a portion of the Food Network.
Traders on Wall Street have bid up Tribune shares over the past two sessions in heavy trading, including a 3.5 percent increase yesterday. Several traders maintained that the company was making headway in negotiations with Zell.
"This is far from a done deal, but Zell has improved his offer substantially," said the source, who declined to be named because the deliberations are supposed to be confidential. "Many people would argue it is the best solution for shareholders."
Tribune spokesman Gary Weitman declined to comment, and Zell did not immediately respond to a phone call.
James Rainey, Michael A. Hiltzik and Thomas S. Mulligan write for the Los Angeles Times.