Philadelphia Newspapers LLC, the owner of the Philadelphia Inquirer and the Philadelphia Daily News, offered creditors $50 million as part of a plan that would allow the company to exit bankruptcy.
The investor group that purchased the newspapers in 2006 made the offer in a meeting with creditors on March 9, according to papers filed yesterday in U.S. Bankruptcy Court in Philadelphia.
The proposal would give the creditors new cash as well as notes, financial adviser Sonenshine Partners LLC said in the filing. New York-based Sonenshine said it’s representing Philadelphia Newspapers in ongoing talks related to the proposal.
On Feb. 22, Philadelphia Newspapers became at least the fourth newspaper publisher to file for bankruptcy protection since December. The biggest was Tribune Co., owner of the Los Angeles Times and Chicago Tribune. Both companies entered bankruptcy after being acquired with borrowed money.
Philadelphia Newspapers won permission yesterday to use the company’s cash to fund operations while it attempts to reorganize.
The case is In re Philadelphia Newspapers LLC, 09-11204, U.S. Bankruptcy Court, Eastern District of Pennsylvania (Philadelphia).
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