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Tribune bankruptcy: Judge may rule for company's plan this week

July 11, 2012|By Michael Oneal
  • Pedestrians walk by Tribune Tower, headquarters of Tribune Co. The company, which owns the Los Angeles Times, the Chicago Tribune and other media properties, may get approval this week to exit Bankruptcy Court.
Pedestrians walk by Tribune Tower, headquarters of Tribune Co. The company,… (Scott Olson / Getty Images )

WILMINGTON, Del. — U.S. Bankruptcy Judge Kevin Carey signaled that he will confirm a plan to end Tribune Co.’s epic bankruptcy case in an opinion he plans to release later this week.

At a hearing in his Delaware court Wednesday morning, Carey presented two relatively minor issues with the reorganization plan's language with which he still had problems. But he said he has a 50-page draft of an opinion and pending resolution of those two remaining issues that he will present by Friday.

Though he didn’t say so specifically, he strongly hinted that he would rule in favor of a plan proposed by a trio of senior creditors — Oaktree Capital Management, Angelo, Gordon & Co. and JPMorgan Chase & Co. — and supported by the company and the Official Committee of Unsecured Creditors.

A favorable decision would allow Tribune, owner of the Los Angeles Times, the Chicago Tribune and other media properties, to move forward with a crucial effort to win Federal Communications Commission approval to transfer its broadcast licenses to a new ownership group led by Oaktree.

Tribune lawyers already have been working with FCC staff as they prepare a recommendation for the agency’s commissioners to consider. But the commissioners themselves won’t start deliberating until they have Carey’s confirmation decision, and it is uncertain how long it would take them to resolve the issue.

FCC approval is the last major hurdle preventing Tribune from exiting a Chapter 11 process that began nearly four years ago and has generated more than $400 million in attorney and other professional fees. The company has said it is optimistic that the process will go smoothly and that the company will be able to emerge from bankruptcy later this year.

Michael Oneal is a staff writer for the Chicago Tribune.

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