Ugly Details in Selling Newspapers

By DAVID CARR
NYT

Any look behind the curtain of Wall Street is not going to be pretty. But there is not pretty and then there is plain ugly.

James O’Shea, the former editor in chief of The Los Angeles Times, found a classic of the genre in the course of reporting out “The Deal From Hell: How Moguls and Wall Street Plundered Great American Newspapers,” his deep dive into the two deals that tipped over the companies that owned, among many other newspapers, The Los Angeles Times and The Chicago Tribune.

Here’s the capsule version: in 2000, The Tribune Company, owner of the Tribune and many other papers, bought the Times-Mirror Company, owner of The Los Angeles Times, for a then-record $8.3 billion. The merger never yielded much in the way of synergy, and the combined company put itself in play in 2007, when there were few buyers left.

Enter Sam Zell, a real estate tycoon with a fondness for distressed assets, who took over the business with the help of an Employee Stock Purchase Plan that saddled Tribune with $13 billion in debt. The company is now mired in a two-year, hugely expensive bankruptcy.

(More here.)