Folks in Allentown have no doubt followed published reports for months now about the Tribune sale, the Zell Deal, ESOPs and undefined material adverse effects clauses, but comments published in The New Yorker must have really captured their interest. Zell was quoted as saying: "I've had offers on every single asset in the portfolio. Chuck Schumer calls me, because he's hustling for some people who want to buy Newsday. Baltimore people are calling, Allentown's calling, Florida's calling, and, in L.A., David Geffen and Eli Broad."
Tribune said in March that it had no plans to sell The Call, though it had 2 Connecticut papers on the block as part of a corporate restructuring plan. Under the Zell Deal, there's a big tax incentive to keep the company intact for 10 years.
''Sam Zell is not known for selling at the bottom, which is where the newspaper industry is these days,'' said John Morton, a news industry analyst in Maryland. ''I don't think selling is something Sam Zell would be interested in.''Well, who's to say there won't be solid incentive offers attractive enough for Zell to sell off some of the papers — sooner than later — right after the Deal is done. The money people calling Zell to express interest in the papers must know there's a chance, if not a possibility, he'll sell.
Speculation from every corner will continue until the Deal is done. Zell has everyone's attention, but most especially the future employee-owners who under the multi-billion dollar deal stand to gain big but lose bigger if the company fails.
Zell's track record as a moneymaker is impressive. He doesn't lose. But in this, the most leveraged deal ever, the employees carry the greatest risk. So how come he's getting all the ink and not them?