Under the plan, Freedom’s secured debt would be reduced from $770 million to $325 million. Unsecured creditors would split an initial $32.2 million but would be able to pursue a lawsuit against the company board and insurance companies in an effort to recoup up to $25 million more.MediaNews Group, meanwhile, will file its bankruptcy plan sometime in early March and already an affiliate of the Tribune Co. has filed a preemptive challenge. From the Denver Business Journal:
The Hoiles family, which has owned the flagship Register newspaper since 1935, would have no ownership. The lenders have already named a new board of directors that will take over when the company emerges from bankruptcy. According to the court filings, Osborne will be the post-bankruptcy CEO. He has been interim chief executive since last summer.
According to the objection, GreenCo paid $2.4 million in 1998 for an irrevocable option to buy all of the assets and business operations of the Los Angeles Daily News, which is owned by MediaNews Group. The option, which was due to expire in 2010, has never been exercised, and GreenCo says it’s owed at least $8.4 million under the terms of the contract.