Tribune reaches agreement with creditors
Would settle any claims arising from Sam Zell's buyout dealNEW YORK -- Tribune has reached an agreement with major creditors including J.P. Morgan, Angelo Gordon and Centerbridge Partners that would settle all potential claims arising from the deal that saw Sam Zell take the company private in 2007.
The settlement, also supported by the Official Committee of Unsecured Creditors of the media company, will be incorporated into a plan of reorganization expected to be filed shortly with the U.S. Bankruptcy Court for the District of Delaware. The company said the plan, if approved, would allow it to emerge from bankruptcy later this year.
Tribune CEO Randy Michaels said the agreement will enable the firm to file the reorganization plan prior to a Tuesday court hearing.
"It is another significant step forward as we continue to transform our media businesses, attract and retain talented people, and seize opportunities to grow," he said.
Under the terms of the plan, the holders of senior notes would receive 7.4% of the company's distributable value in a combination of cash, debt and stock. The company's senior credit facility lenders would receive cash, debt and stock representing more than 91% of the equity of the reorganized company.
"The plan will allow us to resolve these cases without the distraction, expense and delay of protracted litigation, and is in the best interests of Tribune and all of our constituents," said Don Liebentritt, Tribune's chief legal officer.
Tribune filed for Chapter 11 bankruptcy in December 2008.