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Mergers News

Tribune favors Zell bid, pushes for more - papers

NEW YORK, April 1 (Reuters) - Tribune Co. TRB.N is pushing Chicago real estate magnate Sam Zell to raise his bid for the company, The New York Times reported, a day after the publisher and broadcaster's deadline to decide its future passed. The Wall Street Journal, meanwhile, reported on Sunday that Tribune TRB.N is firming up a deal to sell itself to Zell, citing sources familiar with the matter.

A deal with Zell would freeze out Los Angeles billionaire philanthropist Eli Broad and his partner, billionaire grocery store investor Ron Burkle. The two last week made a new bid of $34 per share including $500 million in cash, a source said.

Zell’s plan, which reportedly includes $300 million of his own cash, is structured as an employee stock ownership plan, as is Broad’s and Burke’s bid.

A special committee of Tribune board members prefers Zell’s offer of $33 per share, the Journal said, while the Times said Tribune executives told Zell on Friday that he would have to offer more money if he wanted to buy the company.

The Tribune board on Sunday rejected Zell’s response, which was an offer close to $34 a share, the Times reported, citing sources. The Times also said Tribune gave Zell 12 hours to make a new offer, and that the board plans to meet late tonight and accept Zell’s offer if it is high enough.

It is unlikely that the board rejected Broad’s and Burkle’s bid because it would leave them without leverage to push Zell to increase his bid, the Times said. It is unclear how much Zell planned to offer or if he would even make another offer, the Times also reported.

A Tribune spokesman, a spokeswoman for Broad and Burkle and a spokeswoman for Zell all declined to comment.

((Reporting by Robert MacMillan; Editing by Andrew Callus; Reuters Messaging: robert.macmillan.reuters.com@reuters.net; 646-223-6012; e-mail: robert.macmillan@reuters.com.)) Keywords: TRIBUNE BIDS/

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