Tribune Co. will ask creditors to vote to settle allegations Chairman Sam Zell and company lenders violated bankruptcy law and left it insolvent when they organized a 2007 buyout that took the publisher private.
As part of its effort to exit bankruptcy, Tribune will send its reorganization proposal to creditors for a vote. The reorganization is built on a proposal to settle claims by lower-ranking creditors that the buyout was a fraudulent transfer because it increased Tribune’s debt by about $8.3 billion and only benefitted Zell and company shareholders.
“We feel pretty good about what will happen at the ballot box,” Tribune attorney James Conlan said in court today. More…