Judge extends Oct 15 reorganization deadline after creditors complain they need time to study Tribune’s own plan to exit Chapter 11
“Please, sir, I want some more.”
That’s what junior creditors of troubled media giant Tribune Co. asked U.S. Bankruptcy Judge Kevin Carey. The Delaware judge said Yes.
Carey has extended the deadline for Tribune and its creditors to submit reorganization plans that could see the company finally exit its 22-month Chapter 11 from Oct. 15 to Oct. 22. The change came after creditors told the judge, in a conference call Wednesday, that they needed time to study Tribune’s plan before they send in their own proposals. Creditors will now have seven days to react to the company's scheme and submit their own plans on Oct. 29.
The company had no comment on the ruling.
Tribune, owners of the Los Angeles Times, the Chicago Tribune and various broadcast properties, has been in Chapter 11 since December 2008 — less than year after current chairman Sam Zell took the company private in late 2007 in an $8 billion buyout that was cited for “dishonesty” by an independent examiner earlier this summer.
On Monday, Tribune announced that it has reached a settlement and reorganization with major creditors in its 22-month bankruptcy case.
The deal, which is very similar to a plan submitted in Sept by New York hedge funds and Tribune creditors OakTree Capital Management and Angelo, Gordon & Company, two major creditors in the Chapter 11 case, has the backing of the Committee of Unsecured Creditors, OakTree Capital Management and Angelo, Gordon & Company and JPMorgan Chase.
Endorsed by Judge Kevin Gross, the court appointed mediator, the as yet not submitted deal could see hundreds of millions in payments, a partial end to many of the legal claims that have come out of Zell’s privatization of company and the media giant finally in the clear.
Today’s change in deadline dates means that any hearing on the respective plans won’t likely happen until mid-November at the earliest with a mandatory disclosure statement hearing putting up the various submitted plans for vote scheduled for Nov. 29.