Tribune Company Files For Bankruptcy Protection

By Marcus Gilmer in News on Dec 8, 2008 7:30PM

After a whirlwind of speculation in the past 24 hours, the Tribune Company has officially filed for bankruptcy protection today, the same day it faces a deadline for $70 million in unsecured debt it's had since before Sam Zell bought the company. The announcement is not a big surprise after yesterday's announcement that the company had hired advisers Lazard Ltd and law firm Sidley Austin to explore its options. The sale of the Cubs (as well as Wrigley Field and a stake in Comcast SportsNet) was expected to be completed earlier this year and might have helped the company stave off such a filing.

Severe reductions in advertising this year because of the recession have put pressure on the Chicago-based company. Most of its debt comes from the complex transaction in which the company was taken private by real estate mogul Sam Zell last year.

Although the next major principal payment isn't due until June, analysts say Tribune has been in danger of missing lender-imposed financial targets.

Tribune made the filing Monday in bankruptcy court in Delaware.

The Chicago Tribune is one of the company's two flagship newspapers, the LA Times being the other. The company remains $13 billion in debt.