In its first board of directors meeting since emerging from a protracted bankruptcy, Tribune Co. named investor Bruce Karsh as chairman and veteran entertainment executive Peter Liguori as chief executive.
Eddy Hartenstein, who served as chief executive for almost two years, remained on the board and will continue as publisher and chief executive of the Los Angeles Times, the largest of eight daily Tribune newspapers. He also will act as special advisor to Liguori.
Karsh is president of Oaktree Capital Management, the private equity firm that now owns 23%, the biggest single stake, in Tribune. Liguori is a former chief operating officer of cable programmer Discovery Communications.
“Peter is the ideal choice,” Karsh said. “He has the talent and experience to lead the company forward, and has a track record of success. The board has every confidence in him.”
The new board, which met Thursday in Oaktree's Los Angeles office, hopes to transform a conventional media company of primarily newspapers and television stations into one that will prosper in the digital age. Tribune also owns 23 television stations, including KTLA-TV Channel 5 in Los Angeles and national cable network WGN America. It also has a stake in the Food Network.
Liguori said Thursday in a letter to the staff that Tribune has “unparalleled media assets, iconic brands in major markets and very talented, creative employees.” The company, he said, is an example of “what is best in media, television and journalism in America.”
In an interview, Liguori did not rule out the possibility that the new owners might sell the newspapers and other assets and focus Tribune's future on television. But, he said, he is not “going into this job with a fire-sale sign.”
Tribune came out of its four-year bankruptcy at the end of December with $1.1billion in debt and a $300-million line of credit.
“The company has a very solid balance sheet and cash on hand and an opportunity to grow,” Liguori said.
Though Tribune faces challenges, he said, it has established brands across multiple platforms that are key to a bright future. Here are excerpts of the interview:
What attracted you to the job?
This is a company of incredible media assets and big iconic brand names, many of them in major markets all across the country. I think there is a lot of talent in the rank and file. I think the company has a very solid balance sheet and cash on hand and an opportunity to grow. I think there are great opportunities with the assets that we have and I think there are a lot of challenges. Innovation and great content will grow the business.
What are your priorities?
The only way you are going to be successful is in partnership with your viewer or your reader, period. What are the needs of the communities and our constituents? What are the needs of our advertisers and our affiliates? I almost look at this company as a 165-year-old start-up. We have the luxury of great brand familiarity and great brand history, and I think it allows us to move and be nimble, the total opposite of what a lot of entrenched institutions are.
How will your programming and marketing experience at Fox and Discovery help Tribune, a company whose biggest assets are TV stations and newspapers?
It is all about making sure you are doing the best job of servicing that end user. And if you are doing it better than everyone else and you're best in class in terms of how you are operating your businesses, you're going to grow the bottom line.
There has been an assumption that there is synergy in owning newspapers and TV stations in the same city. What are your thoughts on that?
I'd like to be allergic to the buzzword “synergy.” I'd rather look at it as an opportunity. When you look at Chicago, a great radio asset in WGN radio, a great local TV station in WGN and an iconic newspaper … you know that you have great penetration in that city. I think the opportunity is being outward focused and saying if so many of these people are coming to Tribune properties over the course of their daily lives, what can we do for them that will keep them informed and keep them with us? Servicing the user will create a natural flow from platform to platform.
What are your plans for WGN America, Tribune's national cable channel?
I do think we should be looking at WGN America and investing in it and creating original programming which services the audience. If we do a good job at that, we're going to attract advertisers and be of greater value.
How can Tribune's papers best address the challenges facing the newspaper business?
There isn't an overnight solution. First and foremost, have best-in-class journalism. You have to take that content, have it be applicable across all media platforms — mobile, digital and good old-fashioned print. You've got to get paid for it. And now more than ever, you'd better be as efficient as possible. Our job is to grow the bottom line, but if we're increasing our profitability and our margin, it also opens up to investing in the businesses and being more innovative.
Newspapers continue to lose ad revenue from print, but advertising on the Web isn't picking up the slack. Can that be fixed?
It's something that the industry in general is going to have to focus on and do a better job. I think there is going to be a lot of trial and error.
Are there plans to sell the newspapers?
There are people interested in the newspapers. It is my fiduciary responsibility to hear them out and see if in fact their interest is real and their commitment is concomitant with the value of these newspapers. But that runs parallel to my working with you guys on running the business on a day-to-day basis to maximize the value.
Are there other assets Tribune might look to sell?
I'm not going into this job with a fire-sale sign. I come into the job looking to grow the company. If in fact you maximize the value of each and every one of the assets, I do think they become more attractive. Will they have suitors? Yes, they may in fact have suitors. Do I have to listen to them? Absolutely. Do I want to listen to them? Absolutely. It's my responsibility to shareholders to do so. Everything has its own inherent value.
Will you look to take Tribune public eventually?
It's an option. Taking a company public is actually a luxury and byproduct of running a company well.
Some newspaper owners have been selling their valuable downtown locations to take advantage of the uptick in the real estate market. Is there any plan to sell the properties in Los Angeles, Orange County or downtown Chicago?
There is no doubt that we have great real estate — fantastic properties, great areas. We're starting to go out and lease some of the properties in Chicago and Los Angeles at really great rates. There is a very fertile real estate opportunity for Tribune.