Posted by chicagomedia.org on September 25, 2009 at 12:00:11:
Judge OKs Sun-Times auction
But criticizes bidder's concessions deadline
September 25, 2009
BY ART GOLAB | Sun-Times Staff Reporter
A U.S. bankruptcy judge Thursday rejected a Sept. 29 deadline for union concessions as a condition for a group led by Chicago banker James Tyree to bid for the assets of Sun-Times Media Group.
The judge did give the go-ahead for an Oct. 7 auction of Sun-Times assets that would be approved Oct. 8, a move that in effect only pushes the concession deadline back a few days, Sun-Times officials said. Tyree's group has offered to pay $5 million in cash for the Sun-Times assets and assume about $22 million in liabilities.
At a hearing in Delaware, Judge Christopher Sontchi said the sale doesn't have to close until early December, and that Tyree would be liable if he walked away two or three months before closing.
Sontchi also rejected an agreement with Tyree's group that called for any competing bidder to promise to operate Sun-Times Media as a going concern for at least six months.
Sun-Times Media Group CEO Jeremy Halbreich said the judge opened the door "for pure liquidating companies to come and look at our assets, which from the perspective of maintaining these newspapers as businesses going forward, that is not a good thing."
Five of the Sun-Times' 18 unions have already turned down concessions required by Tyree as a condition of his bid. Those concessions involve locking in wage cuts for three years and work rule changes. Newspaper Guild President Tom Thibeault welcomed the judge's comments, saying he "was basically speaking from the back of the bench, saying let's get this done, let's negotiate."
Tyree didn't see it that way. He said the Sept. 29 deadline was meant to provide enough time to "expeditiously close on Oct. 8," and if changes to the union contracts aren't "approved during that time frame, what happens is then the deal won't go through, and then frankly the U.S. trustee or somebody else will petition to liquidate."
"Let's put it this way," Tyree said, "I'm not going to walk away, but I'm not going to close until those contingencies are met."
Tyree said that he is still "very hopeful," even though he's disappointed to see himself castigated by union members on blogs. "These folks have never met me, they don't know my intentions. Frankly I'm trying to save 1,800 jobs, and I'm trying to work on the unions' behalf. But I guess they don't think so."
Tyree said he hopes at some point to meet with Sun-Times employees. "I want to go and find a way to sit with everybody and explain what the plan is, what my reasons are. . . . What we need collectively is a group of very happy, motivated people to make this work."
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