More Trib assets may be on the block

CHICAGO -- Tribune Co. CEO Sam Zell said Thursday he may sell off more of the media conglomerate's assets than planned because of the rapid deterioration of the company's revenues.

Four months after taking Tribune private, Zell told analysts and investors his new management team has made "enormous progress" toward changing the company's culture and launching new initiatives but provided a sobering assessment of its financial trends.

Tribune's liquidity remains little-changed and the company is on track to make its $1 billion in required debt payments this year, Zell said.

But the weak economy is accelerating Tribune's revenue decline and more advertisers are fleeing to the Internet, he said. Double-digit declines in print advertising are expected this quarter, consistent with the free fall taking place throughout the newspaper industry.

He confirmed that he's considering selling more of the company's properties, including Long Island-based Newsday, among the largest holdings in its stable of close to a dozen newspapers and 23 TV stations.

"When we originally entered into this transaction, our goal was to keep everything together and to preserve the ownership of all of the assets," he said on a conference call. "The significant erosion in the first quarter has certainly put that plan into some questions and we are forced to consider the possible divestiture of some of our assets."

The Chicago Cubs and Wrigley Field have been on the block since even before the real estate mogul closed the $8.2 billion buyout of Tribune in December. He said "meaningful discussions" are still under way to try to sell historic Wrigley to the Illinois Sports Facilities Authority.

The company plans to send out financial books detailing the Cubs' franchise to Major League Baseball-approved bidders in the next 10 days to 2ˆ½ weeks, with Wrigley Field data included in case its hoped-for sale to the state-backed facilities agency falls through.

Zell didn't discuss any specifics of potential asset sales or give any first-quarter numbers, which he said will be disclosed next month. He said the quarterly update was just to brief those who follow the company, which has a $13 billion debt load.

Asked to elaborate on a possible Newsday sale, he said only that the company has been approached by a number of parties who have a keen interest in acquiring it.

"We have reached no conclusions with anybody at this juncture and we are discussing whether it does or doesn't make sense for the Tribune Co. going forward," he said.

According to reports, the prospective buyers may include real estate developer Mortimer B. Zuckerman, who also owns the New York Daily News and U.S. News & World Report; Rupert Murdoch's News Corp.; and Cablevision Systems Corp.

Echoing Zell, longtime associate Randy Michaels, the new CEO of broadcasting and interactive at Tribune, said the environment the company is in is "tougher than I think any of us expected it to be." But both insisted they remain upbeat about the company's potential.

Despite the challenges, Zell said it remains clear Tribune has tremendous opportunities over the long term.

"Whatever thoughts we had about the assets and the opportunity with these assets has only been reinforced with the 90-day experience," he said.