Tribune Co has hired investment banks Evercore Partners and J.P. Morgan to assess interest in its newspaper unit, which includes The Los Angeles Times and Chicago Tribune, the company confirmed in a statement on Tuesday.
A sale of its eight major newspapers, which also include The Baltimore Sun, has been widely expected since Tribune emerged from a four-year bankruptcy process late last year.
"There is a lot of interest in our newspapers, which we haven't solicited," Tribune said in a statement. "Hiring outside financial advisers will help us determine whether that interest is credible, allow us to consider all of our options, and fulfill our fiduciary responsibility to our shareholders and employees."
News of a potential sale of Tribune's newspapers follows last week's announcement that the New York Times Co also hired Evercore to auction off The Boston Globe and related properties.
Taken together, that means that three of the top 25 newspapers in the United States could be up for sale.
Tribune's new chief executive, Peter Ligouri, and some of its new directors have broadcasting rather than newspaper experience, suggesting that the company plans to concentrate on its 23 TV stations and its national cable network, WGN America.
The hiring of Evercore and J.P. Morgan means the beginning of the parlor game of guessing potential bidders, especially for the Los Angeles Times. In the past, the daily has attracted interest from entertainment executive David Geffen, billionaire philanthropist Eli Broad and supermarket magnate Ron Burkle.
Other notable names such as Warren Buffett and News Corp's Rupert Murdoch have surfaced as possible buyers for some of Tribune's dailies.
Indeed, Buffett went so far as to tell The Morning Call in Allentown, Pennsylvania - one of Tribune's newspapers - that "Allentown is our kind of place" after being asked if Buffett's Berkshire Hathaway was interested in the paper.
News Corp declined to comment. A spokesman for BH Media Group, a subsidiary of Berkshire Hathaway that operates its newspapers, was not immediately available for comment.
Aaron Kushner, the owner of the Orange County Register near Los Angeles, said he was "prepared to take a serious look" at Tribune's newspapers in December.
U-T San Diego owners, Doug Manchester and John Lynch, whose names had been in the mix, will not make a bid. Lynch said in an email on Tuesday, the U-T, formerly the Union-Tribune, "will not participate in any auction," declining to comment further.
The newspaper sector has heated up in recent months with several properties changing hands or coming up on the block even as readers prefer to access news digitally and advertisers increasingly opt for other media.
The Philadelphia Inquirer and Daily News were sold for about $55 million last year to a group led by Democratic Party fund raiser George Norcross III and former New Jersey Nets basketball team owner Lewis Katz.
Buffett has been steadily amassing what is shaping up to be an empire of small to medium-sized newspapers, with the most recent deal coming on Monday to buy the Tulsa World in Oklahoma.
Tribune's newspapers are profitable and estimated to be worth $623 million, according to a report by its financial adviser Lazard. Its TV operations are estimated to account for $2.85 billion of the company's $7 billion valuation, which also includes a 30 percent stake in the Food Network and the company's cash balance.
CNBC first reported Tribune's hiring of the banks.
(Reporting By Nadia Damouni, Jennifer Saba and Ben Berkowitz; Editing by Peter Lauria, Maureen Bavdek, Nick Zieminski, Leslie Adler and Steve Orlofaky)