Star Tribune receives court approval to exit bankruptcy protection
With the reorganization plan of the Minneapolis Star Tribune having received the due approval of Judge Robert Drain of US Bankruptcy Court in Manhattan on Thursday, the emergence of the newspaper from Chapter 11 bankruptcy protection is imminent by the September end.
The reorganization plan of the Star Tribune aims at giving the ownership of Minnesota's largest newspaper to its senior lenders, in a proposed debt-for-equity swap. As per the plan, the paper's secured creditors - led by New York investment firm Angelo Gordon & Co - will swap $400 million in senior secured debt for $100 million in new debt; thereby acquiring a 95 percent stake in the new company.
Other than Angelo Gordon, Star Tribune's new owners include Credit Suisse Group, Wayzata Investment Partners, CIT Group and GE Capital.
Though there has been no disclosure about the name of the prospective head of the reorganized company, the 'steering committee' of the new owners has the probable chief candidate in mind. Till the time a new publisher is named and a formal contract is signed, the earlier head Chris Harte will continue.
Meanwhile, the committee has named four new board members, two of which are: L. Gordon Crovitz, an ex-Wall Street Journal publisher; and Michael E. Reed, head of GateHouse Media, a chain of newspapers based in Fairport, New York.
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