The Sun Co.?s recently announced qualified buyout plan of 50 employees is not driven by parent company Tribune?s $8.2 billion pending leveraged buyout, Sun Vice President for Marketing Tim Thomas said.
And neither were the recently announced cutbacks ? of 150 and 100 respectively ? at Tribune Co.?s Los Angeles Times and Chicago Tribune papers, according to Tribune Company spokesperson Gary Weitman.
“The actions being undertaken at our newspapers reflect fundamental changes going on across the media industry,” Weitman said. “We cannot stand still; as revenues have slowed, our newspapers are scaling expenses accordingly.”
Representing the smallest of the announced cuts, The Sun?s buyout plan offers a week?s pay for every six months of service to qualifying employees. It is expected to cover about 85 people, mostly senior workers in the 1,550-employee company. And if the target number of 50 is not reached, Sun Company Director of Marketing and Communications Linda Yurche said it may become a layoff.
Ineligible employees, however, can also apply for buyout consideration.
But the plan is still subject to collective bargaining with the Newspaper Guild, which represents about 500 Sun employees, according to Washington-Baltimore Newspaper Guild President and Sun business reporter M. William Salganik.
“I think this was going on before [the Zell deal],” Salganik said, who added that he was about to enter plan negotiations with management and expected settlement before the day was out. “It?s clearly a Tribune thing. … It?s a Tribune decision to do this, but when they decided I have no idea.”
Yurche, however, said the move was entirely a Baltimore Sun Co. initiative, and represented a response to declining ad sales.
“People are concerned about what this will do in how we serve our readers and advertisers,” Salganik said of the plan, “and it doesn?t seem like a good long-term business strategy. If Starbucks has a bad quarter, they don?t respond by watering down the coffee.”
Buyout-related calls to real estate mogul Sam Zell ? who is orchestrating the public-to-private leveraged buyout of Tribune Co. ? werenot returned by deadline. Zell is known as the “grave dancer” for his talent for wringing value out of flagging businesses.
Employees may begin signing up for the buyout April 27 through May 29, with the last day of work being June 1.
