Tribune Co., which last week made a deal to expand its TV
station holdings, said Wednesday it plans to spin off its newspaper business.
After the proposed spinoff, there would be two separate
companies. One would be Tribune Co., whose assets would include 42 TV stations
in 33 markets, WGN Radio, superstation WGN America, Tribune Studios,
CareerBuilder and a stake in Food Network.
The other company would be Tribune Publishing Co., which
would own newspapers in markets including Los Angeles, Chicago, Baltimore,
South Florida and Orlando.
Tribune says its board spent the last several months
evaluating strategic options.
"Moving to separate our publishing and broadcasting assets
into two distinct companies will bring single-minded attention to the
journalistic standards, advertising partnerships and digital prospects of our
iconic newspapers, while also enabling us to take advantage of the operational
and strategic opportunities created by the significant scale we are building in
broadcasting," Peter Liguori, Tribune's president and chief executive officer,
said in a statement. "In addition, the separation is designed to allow each
company to maximize its flexibility and competitiveness in a rapidly changing
Tribune says that during the next nine to twelve months, its
management team plans to develop detailed separation plans for the company's
board of directors to consider. Upon the closing of the proposed transaction,
each entity would have its own board of directors and senior management team.
"The two companies resulting from this transaction would
each have revenues in excess of $1 billion and significant operating cash
flow," said Liguori. "We expect that this transaction will serve our
shareholders and employees well, and put these businesses in a strong position
for continued success."
Last week, Tribune doubled down on its local TV investments
by announcing the $2.73 billion acquisition of Local TV LLC. The deal will make
Tribune the biggest owner of affiliated TV stations in the country.
separating its TV assets from its challenged newspaper businesses, Tribune Co.
is following in the footsteps of News Corp., which last month separated into a
TV and film company, 21st Century Fox, and a publishing company, News Corp.