Saturday, September 23, 2006
© Copyright 2014
Gwinnett Daily Post
CHICAGO - Tribune Co., under pressure from shareholders to boost its stock price, is signaling it may sell, break up or take private the company that owns the Chicago Tribune, the Los Angeles Times, television stations and the Chicago Cubs.
The company is targeting potentially transforming changes by the end of the year following a five-hour meeting of its board of directors on Thursday.
Wall Street reacted positively Friday. A day after Tribune shares rose more than 4 percent, they gained another $1.76, or 5.5 percent, to $33.81 in midday trading on the New York Stock Exchange.
But Standard & Poor's lowered its credit ratings on Tribune to the speculative-grade or ''junk'' category. The ratings agency said the possibility of another stock buyback or sale of parts of the company suggests Tribune won't be focusing on reducing its huge debt, which totaled $4.9 billion as of July.
Under Chairman and CEO Dennis FitzSimons, the struggling media company is moving quickly beyond the plan it outlined in May calling for a combination of select asset sales, a $2 billion stock buyback and further cost cuts. Since then, revenues have continued to decline and the stock price had not increased as much as Tribune had hoped.