1. What are the acquisition vehicle, post-closing organization, form of payment, form of acquisition, and tax strategy described in this case study?
2. Describe the firm’s strategy to finance the transaction.
3. Is this transaction best characterized as a merger, an acquisition, a leveraged buyout, or a spin-off? Explain your answer.
4. Is this transaction taxable or nontaxable to Tribune’s public shareholders? To its post-transaction shareholders? Explain your answer.
5. Comment on the fairness of this transaction to the various stakeholders involved. How would you apportion the responsibility for the eventual bankruptcy of Tribune among Sam Zell and his advisors, Tribune’s board, and the largely unforeseen collapse of the credit markets in late 2008?

At the closing in late December 2007, well-known real estate investor Sam Zell described the takeover of the Tribune Company as “the transaction from hell.” His comments were prescient in that what had appeared to be a cleverly crafted, albeit highly leveraged, deal from a tax standpoint was unable to withstand the credit malaise of 2008. The end came swiftly when the 161-year-old Tribune filed for bankruptcy on December 8, 2008.