Sam Zell's days as a media titan in Chicago are nearly over.

by drewishdrewid on Aug 14, 2009 11:58 AM CDT Comment 14 comments

So much for the master.

The motorcycle-riding billionaire, renowned for his deft touch with real estate and corporate turnarounds, took Tribune Co. private in late 2007 promising to energize the lumbering company. He piled on debt at exactly the wrong time, and a collapse in advertising for traditional media forced him to take the company to Chapter 11 bankruptcy.

Eight months after the filing, two sources familiar with the process said creditors are working on a reorganization plan that elbows Zell aside. The creditors, including investment banks owed $8.6 billion from Zell's Tribune takeover, would stage a takeover of their own and sell off the company's newspapers and broadcast stations as they see fit.

"The banks will be in charge," one insider said, adding that they are growing impatient with Zell's stewardship. The bankruptcy court on Monday granted Zell extended time, until Nov. 30, to be the first to file a reorganization plan. Creditors have to wait at least that long before filing their own plan with the court.

They don't pull any punches.

"This was a textbook case of a leverage buyout gone bad," said Brandt, president of Development Specialists Inc. "These were imbeciles who had no idea what they were doing."

So, this shouldn't change anything, except, perhaps, people's perceptions of Sam Zell as some kind of financial mastermind. He took on too much debt and waited too long to sell assets.

This is a FanPost and does not necessarily reflect the views of SB Nation or Al Yellon, managing editor (unless it's a FanPost posted by Al). FanPost opinions are valued expressions of opinion by passionate and knowledgeable baseball fans.

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Looks like just another sad chapter in Cubs ownership.

Maybe Ricketts will finally get it right.

#zellfail

I've committed to tweeting about the Cubs for the rest of the season. (Does that sound as ridiculous as I think it does?) Anyway, if you're on Twitter, you can follow me here.

by dat cubfan daver on Aug 14, 2009 12:12 PM CDT reply actions 0 recs

And it's why he was so arrogant about trying to get more for the Cubs

all the while the economy was under a total collapse.

Think back….April, 2007. No one heard yet about Bear Stearns. There were no talks about TARP and spending bills, Government Motors; anything. There wasn’t 9.5% unemployment and a myriad of problems in the housing market. Yet this guy who was supposed to be so smart, tried to eek $1B+ out of the Cubs sale all the time when the economy was going to hell in a handbasket.

Just win the next game...!

by blackhawk24 on Aug 14, 2009 12:22 PM CDT reply actions 0 recs

that is how the rich get richer

but when the rich try to stiff the rich, it doesnt work usually

baseball is a game of outs......pop out, ground out, line out, pitch out, strike out, fly out, and Fox and Bud's favorite black out

by Cubbie-Tim on Aug 14, 2009 1:02 PM CDT up reply actions 0 recs

Yawn.

Irrelevant to the Cubs sale. The Cubs sale will happen when it does, likely not till after the season is over.

Linky with more info

"You can observe a lot just by watching." ~ Yogi Berra

by Al on Aug 14, 2009 4:21 PM CDT reply actions 0 recs

I know

nevertheless, I thought it was interesting.

Forget all that other stuff. I gotta believe.

by drewishdrewid on Aug 14, 2009 4:44 PM CDT up reply actions 0 recs

Probably Irrelevant

It does put presure on Zell to complete the sale before November 30, when he is scheduled to file his reorganization plan. If the Cubs aren’t sold by then, and the Tribs creditors seek to change management, everything could change. New management could restart the sales process, although that seems unlikely.

by John in DC on Aug 14, 2009 4:53 PM CDT up reply actions 0 recs

How do you think he got to be a billionaire?

Dumb luck?

Not at all. In this specific instance, he brokered a deal that put him personally on the line for very little if basically nothing, with the potential for enormous profits. In this case, the profits evaporated due to the economic collapse, but he still walks away pretty much unscathed.

Say what ever you want about Sam Zell, but he is not, and has never been a stupid businessman and for those looking to say he got what he deserved, he pretty much didn’t. He walks away more than capable to leverage maximum opportunity out of minimal exposure yet again.

WOXY.com - The Future of Rock and Roll

by Gibbon Jockey on Aug 14, 2009 4:22 PM CDT reply actions 3 recs

Rec'd.

"I won't insult your intelligence by suggesting that you really believe what you just said." ~William F. Buckley, Jr.

by Goodie1969 on Aug 14, 2009 6:20 PM CDT up reply actions 0 recs

Well with that login Zell should buy the Chicago Fire

And sit on the team until soccer becomes as popular in the US as it in worldwide…

Great points though, but Zell really dug his own hole here, and it will be very interesting to see the logistics behind him getting out of it unscathed. It will probably be in Business 100 textbooks for many years to come, because I’m sure he’ll end up making money off the deal in the end. (Can we year year-end write offs, kids?)

by lswaidz on Aug 14, 2009 10:11 PM CDT up reply actions 0 recs

Login = logic, sorry.

by lswaidz on Aug 14, 2009 11:28 PM CDT up reply actions 0 recs

Of course...

…he is not a stupid businessman, but if he was honest, I think he would admit that he didn’t have the proper read of what he was getting into with the Trib. He was smart enough to limit his personal exposure, but I’ll guarantee that is no consulation for him as this unravels.

He isn’t used to not being successful, but he also hasn’t ever dealt with a situation with so many variables.

"I don't like them fellas that drive in two runs but let in three" Casey Stengel

by MPH73 on Aug 14, 2009 11:17 PM CDT up reply actions 0 recs