By David B. Wilkerson, MarketWatch
Last Update: 10:36 AM ET Jun 7, 2006
CHICAGO (MarketWatch) -- Board members representing Tribune Co.'s second-largest shareholder, the Chandler family trusts, have voiced their disagreement with the company's plans to buy back up to 25% of its stock.
In a filing with the Securities and Exchange Commission late Tuesday, Tribune Co. (TRB) said that eight directors approved the newspaper publisher's buyback but that Jeffrey Chandler, Roger Goodan and William Stinehart Jr. of the Chandler Trusts dissented.
The Chandler Trusts own 12.2% of Tribune Co.'s outstanding shares, the filing said.
"Messrs. Chandler, Goodan and Stinehart have also advised the company that they do not share the opinions of the company" on the stock repurchase, Tribune said.
Tribune said May 30 that it would buy back up to 75 million common shares, worth about $2 billion. Up to 53 million of the shares could be repurchased on a Dutch-auction tender offer, under which stockholders can tender some or all of their holdings at a price in the range of $28 and $32.50 each.
The company plans to fund repurchases through bank debt and publicly sold bonds.
After the offer is completed, the company's principal shareholders, McCormick Tribune Foundation and Cantigny Foundation, have agreed to sell 10 million shares to Tribune Co. That sale is subject to adjustment depending on how many shares are tendered, and it's contingent on Tribune Co. buying back at least 30 million shares in the tender.
Tribune Co.'s shares have lost nearly half their value since early 2004. The stock was up nearly 1% at $30.25 in morning trading on Wednesday.