Tuesday, May 8, 2007

Zell: My goal is to preserve everything we have and make it a lot better

In a May 2 interview with Financial Times US, Sam Zell was asked about newspapers in the internet age and their responsibility to the community, the relationship rift between Chicago and Los Angeles and the complex ESOP structure he created to buy Tribune:

FT: Are you at all worried that, because of the fairly complex ESOP structure which you created to buy the company, there is a risk for employees that the pensions that they’re accruing going forward could be lost if things don’t work out?

MR ZELL: The employees’ contribution represents that which the company previously matched their IRA contributions. So it isn’t like they’re taking their pension funds; it isn’t like they’re taking anything that they have.

FT: It’s not the existing? It’s what will be accumulated going forward?

MR ZELL: And it’s only the match part of it going forward that’s relevant. And I guess, when it’s all said and done, I’m putting up $315m. If the employees don’t make any money, then I’m likely to lose my $315m, and despite comments to the contrary, I still think $315m is one hell of a lot of money. And I assure you I’m going to do everything I can to make that profitable, and as a result, benefit the employees.

FT: So you feel like the risk to you is comparable with the risk to them?

MR ZELL: Oh, absolutely. And the interests are totally aligned.

(end of post)

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