Tribune Suitors Renew Talks

Billionaires Ron Burkle and Eli Broad likely will submit a counter offer to Sam Zell's buyout bid.
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Billionaires Ron Burkle and Eli Broad have renewed buyout talks with



and are considering a counter offer to the leading bid from Chicago real estate magnate Sam Zell, according to a source familiar with negotiations.

Burkle and Broad, two California business moguls who have teamed up with the offer to buy the publishing giant, raised objections about the bidding process in a letter to the company's board over the weekend. They complained that they were being shut out of the negotiations unfairly in favor of Zell's offer.

Tribune responded midweek and was exchanging information with Burkle and Broad about Zell's bid on Wednesday, according to the source. While a counter bid from their side is not yet a certainty, the source says it appears likely.

Zell's offer, valued at $33 a share, uses an employee stock ownership plan that would take Tribune private and give employees a majority stake in the company. Zell would own a minority stake in exchange for $300 million in equity.

Burkle and Broad made a previous offer valued at roughly $36 to $37 a share that involves paying a $27-a-share dividend to shareholders and leaving them with shares with an estimated value of $5 to $7. They offered a $500 million equity contribution.

Tribune, which owns the

Los Angeles Times

, the

Chicago Tribune

and a slew of other media assets, has also considered a recapitalization plan on its own that would involve spinning off its TV stations. But the board of directors has recently favored Zell's proposal, according to the source.

The company launched a review of its strategic options last summer under pressure from its largest shareholder, the Chandler Family trust, which publicly expressed dissatisfaction with Tribune's dismal stock performance.

The company has said it will have a resolution to the process in its first quarter, which ends this week, but a source familiar with the negotiations says the deadline is "soft."

A spokesman for Burkle's investment firm, Yucaipa Cos., declined to comment for this story. Representatives for Broad and Zell also declined to comment, and a spokesman for Tribune could not be reached.

Shares of Tribune were recently up 12 cents, or 0.4%, to $31.22.