Conglom releases rev stats, sells TV station
Less than a week after the Chandler family called for a break-up of the Tribune Co., Tribune unleashed several moves Monday meant to show everything is under control.
Conglom released its revenue numbers for May, which it said featured a 2% gain in its newspaper unit and a 3% increase in its broadcast unit.
While neither number was stupendous, the steadiness of both businesses could rebut the Chandlers’ argument that the company is flailing.
Tribune also said Monday it will sell WCWN, its WB affiliate in Albany, N.Y., that soon will become part of the CW, to the Freedom television group.
Move will net the company about $17 million and serve dual purpose of showing shareholders it can still wring cash from its assets as well as give it more of the coin it needs to forge ahead with a buyback plan.
Tribune has said it plans on a sale of about $500 million in assets and hopes to buy back about $2 billion worth of stock.
L.A.’s Chandler family, which controls 12% of the Tribune shares, has called for a break-up of the company, saying TV and newspaper synergies hadn’t come off. Family also has called for the board to appoint an oversight committee that has the teeth to initiate management and strategic changes.
Family also has criticized the buyback plan, saying it didn’t address the core business issues.
But a sale could be tricky given the complicated family trusts that control both the Chandler Trust and Tribune.
And Tribune has not taken the Chandlers’ gambit lying down. Monday’s moves follow a letter sent at the end of last week in which Tribune defended management decisions.
“We completely reject your assertion that the action of Tribune’s board in authorizing the tender offer was ‘hasty and ill-informed,'” it read, adding that the Chandler family had no one to blame but itself.
“The Chandler Trusts were well represented in all such board meetings by their three Chandler Trust-nominated directors, who were given every opportunity to express their views and concerns to the board, Tribune’s senior management and the board’s advisers.”
Still, some of the Tribune’s evidence could just as easily be used against it. The single-digit revenue increases for May, for instance, could demonstrate that the businesses have languished under the same roof, a point on which the Chandlers have been emphatic.
With break-ups in vogue and synergy perceived as a failure, Wall Street has embraced the Chandlers’ onslaught. The Tribune company stock has risen 3% since the Chandlers made their blunt call last Wednesday.