Trib Deal Could Come Undone

Wall Street unsure of Zell takeover will go through
The Tribune Tower in Chicago is seen lit up in this Nov. 16, 2005, file photo. The Tribune Co. remained silent Sunday, April 1, 2007, as its board of directors reportedly met to vote on competing buyout...   (Associated Press)
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(Newser) – The Tribune Company’s shareholders are meeting tomorrow to approve Sam Zell’s $8.2 billion takeover, but whispers persist on Wall Street that the deal will crumble. A disappointing stock price, concerns about the fading newspaper business, and a sagging credit market have convinced some analysts that Zell’s offer of $34 a share will be lowered to ease the company’s debt.

The New York Times outlines three possibilities for Tribune: proceed with the deal as planned (leaving the company with serious debt), cancel the deal (forfeiting tax benefits), or renegotiate the price (facing higher interest charges). Before any deal is finalized, the company must clear several hurdles, including financial tests and FCC approval.