| 
Tribune Company to Appeal Tax Court Ruling
CHICAGO, September 27,
2005 --Tribune Company (NYSE:TRB) said today it will immediately appeal a United States Tax Court ruling issued late this afternoon disallowing the 1998 tax free reorganization of Matt hew Bender, a former subsidiary of The Times Mirror Company. Tribune acquired Times Mirror in June 2000, and inherited the preexisting tax dispute at that time.
"We are disappointed by the court's ruling," said Crane Kenney, Tribune's general counsel. "We look forward to our appeal in the Seventh Circuit."
The exact amount of the tax deficiency has yet to be determined, but is estimated to be in the $1 billion range for both the Matt hew Bender transaction and a similar transaction completed by Times Mirror in the same year. Over time, deductions for state taxes and interest will reduce the net cash outlay to approximately $850 million. The company's current reserves connected to the litigation total approximately $250 million. The company intends to pay the tax promptly through the issuance of commercial paper.
These tax issues are covered by purchase accounting related to the Times Mirror acquisition. On a preliminary basis the company anticipates that approximately $500 million will be added to goodwill on Tribune's balance sheet and that approximately $125 million (after taxes) will be charged to the company's income statement in the third quarter.
CONFERENCE CALL/WEBCAST
The company will conduct a conference call tomorrow, Sept. 28 at 8 a.m. CT ( 9 am ET , 6 am PT ) to discuss the Tax Court ruling and accounting issues. To access the call, dial 877/847-0401 (domestic) or 706/679-5349 (international). The conference ID number is 1011657. Replays of the conference call will be available from Sept. 28, through Oct. 5. To hear the replay, dial 800/642-1687 (domestic) or 706/645-9291. The access code for the replay is 1011657.
live webcast will be accessible through www.tribune.com and through CCBN at www.ccbn.com . An archive of the webcast will be available from Sept. 28 to Oct. 5.
:: ::
::
This press release contains
certain comments or forward-looking statements that are
based largely on the Company’s current expectations
and are subject to certain risks, trends and uncertainties.
Such comments and statements should be understood in the
context of Tribune’s publicly available reports filed
with the Securities and Exchange Commission (“SEC”),
including the most current annual 10-K report and quarterly
10-Q report, which contain a discussion of various factors
that may affect the company’s business or financial
results. These factors could cause actual future performance
to differ materially from current expectations. Tribune
Company is not responsible for updating the information
contained in this press release beyond the published date,
or for changes made to this document by wire services or
Internet service providers. The Company's next 10-Q report
to be filed with the SEC may contain updates to the information
included in this release.
TRIBUNE (NYSE: TRB) is
one of the country’s
top media companies, operating businesses in publishing and
broadcasting. It reaches more than 80 percent of U.S. households
and is the only media organization with newspapers, television
stations, and websites in the nation’s top three markets.
In publishing, Tribune operates 11 leading daily newspapers
including the Los Angeles Times, Chicago Tribune and Newsday,
plus a wide range of targeted publications such as Spanish-language Hoy.
The company’s broadcasting group operates 26 television
stations, Superstation WGN on national cable, Chicago ’s
WGN-AM and the Chicago Cubs baseball team. Popular news and
information websites complement Tribune’s print and
broadcast properties and extend the company’s nationwide
audience. |
