Tribune takeover (subplot: Big business affects you when you least expect it)

Re: Tribune takeover (subplot: Big business affects you when you least expect it

From what I have been told, the Tribune pensions are safe because they are tucked away in some other entity somewhere.

Which kind of makes sense because pensions haven't been an issue for almost two decades. Anyone hired in 1990 or later got an ESOP in lieu of a pension.

Only dinosaurs like me (hired in 1986) get pensions in addition to the current retirement plan.

 

I don't imagine Sam Zell doing this for any other reason than to make big money out of this. And as to an earlier poster, yes, 50% of the company in debt is not a good thing. So instead of making cuts and changes to satisfy shareholders, the new TribCo would be making cuts and changes to satisfy bondholders. If all goes well for Zell, the Trib makes a lot of money and allows him to pay down the vast majority of the debt with money raised from the next IPO. If it does not go well for Zell, he's stuck paying the bonds, which get downgraded based on the company's performance. Either way, I would not look at this situation as any better or worse than public ownership. Just different masters to satisfy.

 

It seems like the safest places to work these days are family-owned papers. The problem is that there aren't that many of them.

 

Well, maybe I shouldn't use the term "pension." What I have IS an ESOP account, that starts paying out like a pension when I retire...It's not a 401K...

 

Santa Barbara is hiring.

 

Re: Tribune takeover (subplot: Big business affects you when you least expect it

Is that account locked into company stock, with no chance to move it somewhere safer?

 

a couple of things:

first, SF Express, see if you can roll that over into something else if you aren't sure. I don't know the exact details of your situation, but often you can make what is called a trustee-to-trustee transfer which avoids a penalty. Perhaps you can move the funds to a fund based on the overall markets, which might be more secure than having things in just one company.

Second, there may be added debt but maybe Zell, who is a real estate guy, is looking at it as a situation where the sum of the parts is greater than the whole. You sell of what you don't want to keep.

A lot of you may instinctively think of the Tribune as a newspaper company, but when you think about it for a minute the Tribune company is as much, if not more, of a broadcasting company. The same might also be said of Belo, which owns the Dallas paper but I think they own more television stations than daily newspapers. The Tribune Company owns stations in at least the three largest markets, and there may be a lot of valuable real estate - I haven't looked at the annual report or the holdings, but that is something to think about.

 

Correct...that's why I refer to it as a pension, because that's how it acts. It's a leftover from the old Times-Mirror days.

By the way, it never occurred to me we might be Express brothers, seems like I should have noticed sooner.

 

Upon further review:

There are a bunch of us, I'm now figuring, who are set to receive partial pension benefits, the old style, not from the ESOP. ESOP isn't even mentioned on the benefits site. It refers only to a pension. So I'm not sure that money's going to be in play in this at all.

I guess we'll just have to see how it all plays out. Sorry to be so personally "insider" on such a big issue, but I figured there might be some old T-M people who might wonder what's going on.

And now, of course, I can't tell.

 

Broad and Burkle raise their bid to $34 per share, one dollar more than Zell's:

http://www.sfgate.com/cgi-bin/article.cgi?f=/n/a/2007/03/29/financial/f171727D10.DTL

 

Can they touch ESOP money that has already been disbursed to employees' accounts?

 

ESOPs are directly tied to company stock. You own the stock. Company has first right to buy, but the individual owns the stock. When it is tied to a retirement payout, the company actually does "repurchase" the stock.
ESOP=Employee Stock Purchase Plan(s)