Sam Zell, the Chicago billionaire, has emerged as the frontrunner to acquire Tribune Co as the auction for the media group enters its final week.

Mr Zell on Friday offered to buy the Tribune for about $33 per share. Tribune has about 240.2m shares outstanding, which would make the bid worth nearly $8bn.

Tribune and its representatives have been working to convince Mr Zell to increase the amount of equity he would contribute to a buyout of the media company, which includes nine newspapers, including the Los Angeles Times, 23 television stations and the Chicago Cubs baseball team.

Under an initial proposal, Mr Zell would put up just $300m of his own money, and would buy Tribune in partnership with a yet-to-be established employee stock ownership plan. Tribune would like to increase Mr Zell’s equity contribution because they are concerned that the company would otherwise take on too much debt, particularly at a time when its revenues are under pressure from weakening advertising sales.

Mr Zell did not return calls, and Tribune declined to comment.

If a deal were concluded, it would represent one of the most dramatic examples of a growing trend of media companies turning away from Wall Street and going private.

It would also salvage an auction that has proved hugely disappointing for Tribune, and laid bare the extend of investors’ concerns about the future prospects of the newspaper industry.

Tribune set the process in motion in September, appointing a special committee to consider strategic options amid pressure from the Chandler family, one of its largest shareholders. Since then, however, it has received two bids – one from California billionaires Ron Burkle and Eli Broad, the other from the Chandlers – neither of which represented a significant premium.

During that time, the newspaper industry has also showed further signs of deteriorarion, losing readers and advertisers to the internet. As a result, the company has already extended the review process once.

Mr Zell’s proposal could also founder over questions about the employee stock ownership plan. The plan would confer tax benefits on the partnership that would make a deal more attractive. However, Mr Zell would have to convince Tribune employees to concentrate much of their retirement investments in company shares.

Unless Tribune decides to accept the Zell offer, it will move forward with a ”self-help” plan that involves issuing debt and offering a dividend to investors.

However, several observers of the media industry are sceptical about the plan. ”It’s clearly not the best outcome for Tribune shareholders. Maybe it seems so in the short term, but won’t solve the fundamental problem of how to create value from traditional media,” a media banker said.

The publisher and broadcaster’s shares closed at $30.53, up 3.5 per cent on Friday.

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