Chicago-based Tribune Company successfully emerged from Chapter 11 restructuring bankruptcy today, according to a press release issued by the company. Among the company’s holdings are the newspapers Chicago Tribune, Los Angeles Times, Hartford Courant, the Baltimore Sun, and the South Florida Sun-Sentinel. The company’s plan of reorganization was confirmed by the United States Bankruptcy Court for the District of Delaware in July, and the FCC granted the company the necessary transfer applications and waivers in November. The reorganization plan became effective today and distributions to creditors have started.
As part of the reorganization, JPMorgan Chase, Oaktree Capital Management, and Angelo, Gordon & Co. will assume control of the company’s properties.
The company has been facing difficulties for some time, in part due to the changing media landscape of the past decade. The Tribune Company initially filed for bankruptcy protection in 2008, faced with high debts from having gone private in a 2007 buyout by Chicago-based investor Sam Zell.
Chapter 11 is known as a “reorganization bankruptcy,” and is primarily used by business. Like most other bankruptcy, it is employed when a business is unable to make payments on its debts. In contrast to Chapter 7, under which a business ceases all operations and liquidates its assets to pay its creditors, in Chapter 11 commonly a business remains in control of its operations as a debtor in possession but is subject to oversights from a bankruptcy court.
Some of the options available to companies who file Chapter 11 bankruptcy to stay in business include being able to raise capital or take out loans by giving new lenders priority on any new business earnings. In addition, the debtor in possession may cancel or reject contracts. Much like other forms of bankruptcy, companies in Chapter 11 are protected by the automatic stay, meaning that most litigation against the company is put on hold.
Some notable examples of companies that have recently gone through a Chapter 11 bankruptcy include Lehman Brothers, Washington Mutual, GM, Enron, and Chrysler.
If you or your business is having difficulty keeping up with your debts, bankruptcy might be able to help. In order to determine whether bankruptcy is right for you, it is important to have your case reviewed by an experienced bankruptcy attorney. The Westbrook Law Group practices exclusively in the area of bankruptcy law, and has helped hundreds of clients regain their financial footing. To schedule a free consultation with an experienced St. Louis bankruptcy attorney, please call us today at (636) 493-9231, or fill out the contact form to the right and a member of our staff will be in touch with you shortly.