Rupert Murdoch’s media group is understood to be interested in purchasing the Los Angeles Times as well as the Chicago Tribune from the creditors of the papers’ bankrupt owner, Tribune Company, which is attempting to extricate itself from Chapter 11 bankruptcy protection.According to reports by the Los Angeles Times and Reuters, News Corp executives, including Mr Murdoch’s youngest son, James, have flown to Los Angeles twice this month for early stage talks to buy the papers in a deal which could be worth $400m £249m.
News Corp sources attempted to play down the reports last night.“Reports that News Corporation is in discussions with Tribune or the LA Times are wholly inaccurate,” a spokesman said.Mr Murdoch, the News Corp chairman, is said to have long coveted the Los Angeles Times and buying the papers would strengthen News Corp’s grip on the US newspaper industry
The Tribune Company went into bankruptcy four years ago after collapsing under the weight of debt that resulted from a leveraged buy-out, combined with a downturn in advertising revenue following the financial crisis.
The company also owns 23 television stations and is thought likely to attract interest from a range of buyers.The prospect of Mr Murdoch buying the two newspapers is likely to be challenged by some News Corp shareholders, who ascribe little value to the newspaper business. News Corp shares have jumped more than 40pc in the past 12 months because the company is putting $10bn of its cash into buying back shares, rather than large acquisitions.
A swoop for two of America’s most historic papers would come just as a majority of News Corp’s independent shareholders voted for the first time to appoint an external chairman for the group. The resolution presented at News Corp’s shareholder meeting last week was defeated because the Murdoch family control almost 40pc of the voting rights, but underlined the growing appetite to loosen the Rupert Murdoch’s grip on the business.Mr Murdoch’s last major deal for a newspaper was the $5.6bn he paid in 2007 for Dow Jones, the publisher of The Wall Street Journal.
The 81-year-old may also be emboldened to make a bid be-cause over the summer News Corp announced a plan to spin off its publishing business, which includes newspapers. Mr Murdoch will be chairman of the business but has yet to name a chief executive.