The Tribune bankruptcy saga continues.
The judge in Tribune Co’s Chapter 11 case rejected two competing plans for reorganizing the company on Monday, according to the Los Angeles Times, extending the company’s three-year stay in bankruptcy.
There were two plans on the table for U.S. Bankruptcy Judge Kevin J. Carey’s consideration. One was proposed by Tribune and a group of senior creditors, including JPMorgan Chase, and the other was proposed by hedge fund Aurelius Capital Management and a group of junior bondholders, who argue that Tribune’s proposed $500 million settlement payment is too cheap.
In his 126-page opinion, Carey said neither plan was confirmable but he appeared to favor Tribune’s plan, describing the tenets of the competing plan as “speculative.”
As Tribune and its debtors review Carey’s decision, one thing is clear: the judge wants the company to exit bankruptcy as soon as possible.
“The debtors must promptly find an exit door to this Chapter 11 proceeding,” Carey wrote.