The major difficulty for the company and its peers, including Gannett
At Tribune, that resulted in a 5.9% revenue decline in July, with revenue at the publishing unit down 8.6%. Advertising revenue fell 10.3%. Classified ad revenue tumbled 18.2%, as real estate revenue dropped a steep 24%. It was another disappointing month from a company that recently reported lackluster earnings.
It's no new story. Month after month, we're greeted with the same declines at all the big publishers. Indeed, this week, Fitch Ratings maintained its negative outlook on the sector, noting that it's particularly concerned about Gannett, Tribune, and McClatchy. Lee Enterprises
Investors seem concerned about Tribune as well. While the Zell-engineered buyout of the company is planned for the fourth quarter at $34 a share, the company's shares closed slightly more than 20% lower than that on Thursday. The Zell group has arranged for the financing that would facilitate the buyout, although participating banks might pull that commitment if there is a material change in the company's circumstances -- which appears to be happening.
Tribune also is selling its historic Hollywood studio complex, once the site of Warner Bros.' filming of The Jazz Singer, which currently serves as the home of Tribune Entertainment and syndicated TV producer Tribune Studios. In addition, the company is looking to offload its local TV station, KTLA.
I'll say it again: I remain skeptical that Tribune will be taken private this year, at least at $34 a share. The company's unceasing slide in revenue just doesn't square with plans to take on more than $10 billion in debt to complete the transaction. Watch this one with me, Fools, but please don't try to make a quick buck on that 20% share-price gap.
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Fool contributor David Lee Smith, an avid reader of his newspaper's sports section, doesn't own shares in any of the companies mentioned. He welcomes your comments. The Motley Fool has a strict disclosure policy.