The Tribune Company will leave its eight newspapers with over $300 million in debt once the predominately-broadcast company spins off its print division later this year.
According to a filing made by the company with the Securities and Exchange Commission on Friday, the new company called Tribune Publishing will pay its parent company $275 million when the print business separates from Tribune Company’s digital and broadcast properties.
When the print side of the business is spun off, it is expected to carry $325 million in debt. Some of the country’s largest newspapers, including the Los Angeles Times and the flagship Chicago Tribune, will form Tribune Publishing.
The separate company will allow Tribune to avoid hefty taxes that would normally come with selling off part or all of its print properties. It will also allow Tribune Company to collect around $30 million annually in rent from the smaller Tribune Publishing until the end of 2017.
Since emerging from bankruptcy last year, the Tribune Company has focused squarely on its digital and broadcast offerings. The company expanded its television portfolio by acquiring 19 T.V. stations from Local TV, LLC last December for nearly $3 billion.
The company eliminated over 800 positions at its newspaper properties last year, according to financial statements.
Chicago Tribune: Tribune publishing company to take on $300mil in debt