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Creditors seek to probe Zell deal

August 27, 2009|TIMES WIRE REPORTS

Bondholders of Tribune Co. are asking a bankruptcy judge to let them scrutinize the company's 2007 takeover led by real estate mogul Sam Zell. They say the deal loaded Tribune with "unsustainable" debt.

In a court filing, bondholders say the banks that arranged Zell's leveraged buyout "now concede that the transaction was a 'mistake.' "

The bondholders aim to halt Tribune's exit from Chapter 11 under a plan they say will give "all but a sliver" of the company to the very banks they claim caused its demise.

Chicago-based Tribune owns the Los Angeles Times.

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