Magazine article Editor & Publisher

Instant Millionaires: Sale to Cable Giant TCI Means Big Payoff for 24 Longtime Kearns-Tribune Employees

Magazine article Editor & Publisher

Instant Millionaires: Sale to Cable Giant TCI Means Big Payoff for 24 Longtime Kearns-Tribune Employees

Article excerpt

SEVERAL INSTANT millionaires were created on the Salt Lake Tribune and four other dailies owned by Kearns-Tribune Corp. when the company was purchased in a tax-free exchange of stock with Tele-Communications Inc. (TCD worth $731 million.

Under the transaction, announced last spring, the family and employee-owned Kearns-Tribune became a wholly owned subsidiary of Englewood, Colo.-based TCI, the nation's largest cable company.

Kearns-Tribune retains its own name and continues as an autonomous newspaper company. When the exchange was ratified recently, Kearns-Tribune stock was valued at $4.087 a share. Each share was traded for 263.7 shares of TCI common stock, which in mid-August was selling on the Nasdaq market at 18 11/16.

"The torch of financial stewardship passes to you" 82-year-old Kearns-Tribune chairman J.W. Gallivan told 116 individual stockholders and 168 employees who share the $731 million. The employee owners held 7% of Kearns-Tribune, or about $37.3 million of the proceeds.

An announcement by the directors of both companies said TCI traded 47.2 million of TCI common stock in exchange for Kearns-Tribune's five newspapers, their real estate holdings, 17.9 million shares of TCI voting and common stock (an 8% stake) and 6.7 million shares of Liberty Group stock.

The deal calls for a five-year contract between TCI and Salt Lake Tribune Publishing Co., a management group composed of eight former Kearns-Tribune Corp. directors who have complete authority to operate the Tribune; Lewiston Morning Tribune and Moscow-Pullman Daily News in Idaho; Colfay Gazette in Washington, and Sparks Tribune in Nevada.

Thomas K. McCarthey, the Tribune's deputy editor and member of the company's new management board, said in an interview that nearly two dozen employees who signed up for a stock option begun 21 years ago are in the millionaire class as a result of the merger. …

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