Here's a shock: Zell set to bail

http://www.nypost.com/seven/08182009/business/sun_of_sam_eclipse_185148.htm

 

So he bails. Then what?

Who's in charge?

Are the assets sold off?

 

What a bullshit story.
Anyone here think the Federal Bankruptcy Court in Delaware would let Zell take more control of the company?
He can go fuck himself.

 

Creditors.

Maybe.

 

This would be the equivalent of sending a "no" RSVP to a party to which you have not been invited.

Creditors already had made clear to bankruptcy court that they would oppose any reorganization plan proposed by Tribune if Zell remained in charge. He's getting out before they can kick him out.

It's up to the bankruptcy court whether to let Tribune try its own reorganization plan. The court also could decide the company is so (fouled) up that no reorganization would stand a reasonable chance of paying off creditors, and in that case the court could order the assets liquidated for the purpose of raising as much money as possible to pay off creditors.

In that case, the LA Times, Chicago Tribune, WGN, etc all go up for sale, individually or together, whatever raises the most $$$.

 

Normally, if I were an employee at one of Trib's holdings, having the assets sold off piecemeal like that would terrify me... But I think in this case, it would be a good thing.

You'd have half a chance of getting a local owner who cares (a la Geffen - LA Times) as opposed to Zell and his merry band of psychopaths.

I think it would be wise for the bankruptcy court to go that route anyway, because Trib has the cross ownership problem in multiple cities. The newly-in-power Democrats are signaling that they aren't going to give Zell the cross-ownership waivers that Trib enjoyed under the Republicans. And that would be a mess... so why not sell off bit by bit.

I'm a creditor - gimme a deal on WGN.

 

You might get lucky and have a Geffen (or whoever your local white knight is) buy your paper. Or you might get some investment group a la San Diego U-T buying it. In which case, the fun is only beginning.

 

Half a chance is better than none. But, before Zell came in, no doubt the folks thought how much better life would be with an innovative individual owner than under stuffy corporate ownership with absolutely no clue about anything besides slashing and burning. So you never know. Oy.

 

Zell isn't going to be determining anything. The creditors have made that pretty clear.

 

I guess the Tribune didn't put enough puppy pictures on the front page to make enough money.

 

I still don't know how creditors allow themselves to be raked over the coals and stiffed for millions of dollars, yet these newspapers in Chicago and Minneapolis come out of bankruptcy and continue to produce inferior products while overpaying a lot of too-comfortable journalists. And, of course, executives. (I'm only picking on the slackers and those looking to coast to the finish line.)

Since when has it become OK to default on loans and not flip your other assets to pay them back if the business you've bought with the loan isn't supporting itself? I guess that's bankruptcy law, but why in the world would these creditors allow/enable it?

 

So in other words ... he's abandoning ship before he's forced to walk the plank. And the employees are left holding the bag.

I am now taking suggestions as to exactly what kind of karmic punishment should be exacted on Zell. Anybody with thoughts?