Tribune Asks Bankruptcy Court for Extension

By Andrew Gauthier 

The Los Angeles Times

Signaling that infighting among creditors is bogging down reorganization efforts, Tribune Co. has asked a U.S. Bankruptcy Court in Delaware to give its management team until March 31 to craft a plan to exit Chapter 11 without interference from other parties.

If all goes according to plan and the court agrees to extend management’s “exclusivity” — scheduled to expire at the end of this month — Tribune will emerge from bankruptcy by May 31, 2010, according to court papers it filed Friday.

The Chicago-based media company, whose holdings include the Los Angeles Times and KTLA-TV Channel 5, is trying to avoid a lengthy and costly legal battle with some creditors, who are likely to recoup little of their investment in the company given the distressed values of its newspaper and television assets.

A dissident bondholder group has accused Tribune and its senior lenders of hiding “millions of dollars” worth of fees from the court and is conducting an investigation of the $8.2-billion leveraged buyout that gave real estate mogul Sam Zell control of the company. More…