Moody’s cuts Tribune ratings

Moody’s Investors Service has cut its debt ratings for Tribune Company, in light of the expected closing of a buyout of public shareholders by Sam Zell and a new ESOP which will dramatically increase the company’s leverage. Moody's downgraded Tribune's Corporate Family and Probability of Default ratings to B3 from B1. “The increase in leverage is occurring at a time of pressure on Tribune's advertising revenue and operating margins from online and cross media competition and a cyclical downturn in the residential real estate market. The rating actions assume the Zell-ESOP transaction closes in 2007 as expected,” Moody’s noted.

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