Tribune Co. and Local TV have struck an agreement to create a third-party management company that will handle the back-office and administrative work for both company’s broadcast stations.
The new company will be a wholly-owned subsidiary of Tribune and will be headed up by Randy Michaels, who was named Thursday as CEO of Tribune’s Interactive and Broadcasting unit, including the company’s 23 large and mid-sized television stations. Michaels was previously the CEO of Local TV, which owns nine small and mid-sized market stations. Bobby Lawrence was named the new CEO of Local TV.
The new company is designed to create efficiencies through pooled resources for both company’s stations.
“Tribune and Local TV expect to realize significant savings in management, technology, and other overhead costs,” Michaels said in a statement, “Things like research and development and automation technology are more efficient on a large platform. All of the stations get to share the benefits. We are going to find new ways to operate smarter, cheaper, and more efficiently.”
Tribune has not said whether the changes will result in staff cuts. A call to the company was not returned at press time.
The new management company will provide common and transparent administrative services for both company’s stations and may open it business up to third-party stations in the future.
Tribune was taken private through an $8.7 billion deal led by real estate mogul Sam Zell which closed Thursday. In a presentation following the close of the deal, Zell said the company had no plans to sell any assets other than those previously announced: the Chicago Cubs, Wrigley Field and related real estate assets, as well as its stake in Comcast SportsNet Chicago. Those assets are expected to be sold in the first half of 2008.
Last month Tribune received waivers from the FCC for five markets where it has newspaper and broadcast cross-ownership, ahead of the FCC's vote to allow cross-ownership under certain circumstances in just the top 20 markets.