Send lawyers, pens, and money. ESOP to become major shareholder in Tribune sale

The Tribune Company announced yesterday that an agreement was struck to take the company private in a complicated transaction with Sam Zell , the epitome of a contrarian investor. It’s a fascinating deal with a number of different story lines. it’s about the business of law with at least 9 major law firms involved in this substantial transaction. It’s about the business of corporate finance with 3 investment banking firm that helped structure the complicated deal. It’s about the significant changes taking place in the communications industry for traditional mass media.

The deal is a corporate transaction taking place in an ERISA environment. It will be the Tribune Company employees who through a new employee stock ownership plan will own the majority of the common stock. Big corporate ESOPs haven’t always worked, and with the amount of leverage involved, it’s going to take a lot of employee effort – not just corporate restructuring – to make it successful.

But for many Chicagoans and baseball fans all over, it’s only about the Cubs: 99 years and still waiting!

Footnote: The title of the post is adopted from the 1978 hit song, "Lawyers, Guns and Money", by Warren Zevon, a Chicago-born guy who died too young in 2003 at age 56 of the same cancer that killed Steve McQueen. In 2006, Zevon’s song was used as the theme song for producer Jerry Bruckheimer’s short-lived TV series Justice, a program centered on the fictional exploits of high-powered LA-based attorneys.