Creditors Win Auction For Philadelphia Newspapers

The second edition of an auction to sell Philadelphia Newspapers, owner of The Inquirer and Daily News, took place today, and the outcome was very similar to the first time around. Creditors of Philadelphia Newspapers won the auction with a winning bid of $105 million.

That topped the only other bid, which came from local investor Raymond Perelman who placed an $85 million offer. Perelman argued that the bid was better for the company because he guaranteed to keep the company’s employees while the group of creditors did not.

Creditors promised to hold off any layoffs for the first year under its ownership, but it does plan to cut costs by 13 percent and reduce newsroom salaries by 6 percent, according to the Wall Street Journal.

In the first attempt at auctioning off the group of newspapers and other entities, like, was won by the creditors for a total bid of $139 million. But the failure to get all unions in the company to sign onto a new labor agreement left the company back on the auction block.