71. The day the music died
Sam Zell, fractious operator of the Los Angeles Times, is poised to walk away from the paper (and the rest of the Tribune Company), according to news reports today (08/18) that were quickly denied by a Tribune Company spokesman.A reorganization plan being pushed by the company's creditors targets Zell specifically for removal, which helps explain why Zell would be ready to depart now.
Zell hung on to control of the paper by virtue of the 40 percent of the Tribune Company he optioned to buy in 2007, when he took the company private through a leveraged buyout. The purchase option cost Zell about $315 million.
Tribune has $13 billion in debt and less than $8 billion in hard assets. Most of the company's debt resulted from Zell's acquisition of Tribune "? a deal now being investigated by the IRS and the Labor Department. What remains of the company's equity is owned by the employees themselves through their stock-ownership plan. It's likely to get wiped out when Zell heads for the exit and creditors pick over Tribune's remains.
(Because the employee ownership plan is new, financial analysts believe that its losses may be relatively small.)
The end of the Zell era at the Los Angeles Times will come only a few weeks before PBS nationally (and Angel City Presslocally) focus on the family that controlled the paper during its first hundred years. Inventing L.A. "? The Chandlers and Their Times is likely to be a painful reminder of how much the Chandlers and the Times fashioned from sunshine and dreams.
As for Sam Zell . . . He's celebrated in recent years with an odd gift tradition. He gives an elaborate music box to a friend's list of more than 600. His year-end gift for 2008 "? sent in 2009 "? was different. Zell sent a card that said "Somebody stopped the music."
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