Tribune's creditors to toss Sam Zell -- about time.
Aug 14th 2009 11:15AM
Updated Dec 4th 2009 1:06PM
The wee Tribune Co. chairman is fond of loud talk and outsize gestures and in the media world, he'll be remembered for a very big move: His hyper-leveraged takeover of a struggling newspaper and TV conglomerate, and the almost immediate descent of said conglomerate into Chapter 11.
If this sounds a bit like a eulogy, it's supposed to. The Chicago Sun-Times reports that Tribune Co.'s creditors are pushing a reorganization plan that will see Zell out the door and Tribune's assets sold off piecemeal. This isn't going to happen right away; Tribune's management gets to present its own reorganization plan first, and it doesn't have to do that until November. But it's a good bet that, by the time Zell sends out his annual fanciful year-end greeting cards, he will once again be merely a real-estate mogul, no longer a media mogul.
Sad? Hardly. Zell's tenure at Tribune was a letdown from every conceivable standpoint. He failed to produce the revival of Tribune's businesses that he promised, relying entirely on cost-cutting to produce any sort of bottom-line improvement. He gutted the company's newsrooms, especially at the Los Angeles Times, which endured round after round of morale-killing layoffs. He alienated his employees -- "partners," as he liked to call them -- with callous, clueless remarks about the superfluity of journalists and the necessity of giving consumers what they supposedly want, even if it's puppy pictures on page one.
Of course, most newspaper companies are finding ways to founder right now without their own Sam Zells to steer them into icebergs full steam ahead. But that's all the more reason why the creditors have the right idea. Any old fool can ruin a newspaper company. It takes a very special kind of fool to do it as spectacularly as Zell did.