WASHINGTON – Rep. Henry A. Waxman (D-Los Angeles), expressing concern about the future of the Los Angeles Times, is asking Tribune Co. executives to explain the company’s move to spin off its newspaper operations into a separate company.
"I am concerned that corporate actions the Tribune Co. is taking may not be in the best interests of the Los Angeles Times," Waxman said in a letter to Peter Liguori, Tribune’s chief executive.
The company last week filed paperwork with the Securities and Exchange Commission as a preliminary step toward establishing the newspaper unit, to be called Tribune Publishing Co.
The newspaper unit will pay the parent company an undetermined cash dividend, funded through borrowing, according to the filing.
Waxman said the company’s placing the newspaper unit into debt to pay a cash dividend to Tribune will "undoubtedly enrich the Tribune Co., but it may do so at the expense of the financial health of the Los Angeles Times and the other papers in the newspaper unit, all of which are already facing financial strains."
"Some have described the obligation of the Los Angeles Times to pay rent to the Tribune Co. to occupy the paper’s own building as tantamount to ‘life as a corporate orphan,’” he added.
In an interview, Waxman wouldn’t say what actions, if any, Congress could take.
"When we’re talking about an important asset to the Los Angeles community, I think it’s worthwhile and important for members of Congress and others to get involved in it,’’ he said.
"We’ll see what responses we get,’’ he added. "I really don’t want to conjecture on actions because it’s better to get the facts first and then see where the facts lead us.’’
Tribune Co. spokesman Gary Weitman said: "We appreciate Congressman Waxman's interest in the L.A. Times. We are happy to address his questions and have already been in touch with his office to schedule a meeting. Tribune remains fully committed to the long-term vitality of the L.A. Times and all of Tribune publishing."
Liguori said in July that establishing separate publishing and broadcasting companies would allow each company "to maximize its flexibility and competitiveness in a rapidly changing media environment.’’
The new entity would comprise The Times, the Chicago Tribune and six other daily papers.
Waxman has asked for a briefing on how the transaction will affect the Times and his constituents who rely on the paper.
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