The Newsday Chase

Mort Zuckerman, owner of the New York Daily News, isn't going to let his archrival, News Corp.'s Rupert Murdoch snatch away Newsday without a fight. He's matched News Corp.'s offer to pay $580 million for Tribune Co.'s Long Island paper. The Zuckerman camp is also warning that Murdoch's pending deal with Tribune may not withstand regulatory scrutiny. But Tribune Co. CEO Sam Zell is unlikely to jettison Murdoch for the Daily News owner. That's because Zuckerman's bid may have its own regulatory challenges. The proposed deal between News Corp. and Tribune must clear two governmental hurdles. First, Murdoch must persuade the Federal Communications Commission to allow his company to acquire the Long Island paper when it already owns the New York Post and two television stations in the region. (News Corp's also owns the Wall Street Journal.) Former FCC chief of staff Blair Levin, now a media analyst at Stifel Nicholaus, writes that while the agency has "relaxed" its cross-ownership rules, News Corp's bid for Newsday "would appear to push the envelope." News Corp. must also get the deal through the Justice Department's antitrust division. This may be where the acquisitive media company CEO trumps his tabloid competitor. News Corp.'s isn't seeking to buy Newsday in outright sale. It wants to create a joint venture between The Post and the Tribune's Long Island paper. Murdoch surely likes the idea because he may finally be able to staunch the tabloid's estimated $50 million in losses. Zell's company would save as much as $245 million in taxes on the transaction. Predictably, Zuckerman has proposed a similar combination involving the Daily News. But the Justice Department is likely to look more favorably on the marriage of News Corporation's tabloid and the Tribune's suburban paper. Sure, Zuckerman can argue that he needs a joint venture to strengthen the News at a moment when advertisers are abandoning newspapers for the Internet. But Murdoch can make the same case with more vigor. By all accounts, Zuckerman's Daily News turns a profit. The Post loses an estimated $50 million a year.
http://money.cnn.com/2008/04/29/news/companies/leonard_news.fortune/index.htm

Cablevision may make joint bid for Newsday
http://www.reuters.com/article/industryNews/idUSN2929900020080429