Delay in Sealing Deal for Phila. Newspapers
The judge trying to help the company that owns the Philadelphia Inquirer and Daily News exit bankruptcy has moved back the “close of sale” deadline by two weeks. The move gives the prospective new owner more time to negotiate labor contracts.
KYW’s Steve Tawa reports the chief bankruptcy judge, Stephen Raslavitch — who spent several hours over the last two days meeting privately with the participants — decided to put on the record where they stood, since Tuesday was the deadline for closing the deal.
All told, 11 unions have ratified three year contracts, but four — the drivers, pressmen, machinists, and operating engineers — have rejected their offers.
The purchase agreement allows the new owner, a consortium of hedge funds and institutions, to walk away if contracts with the unions are not settled.
Company CEO Joe Bondi is encouraged with the level of continuing discussions:
“And I know both the prospective buyer and the union leaders will diligently seek to arrive at agreement. It’s important that it get out of bankruptcy and be sold.”
(Reporter:) Where is the company on cash flow?
(Bondi:) “It has enough liquidity to carry it through this extension period.”
Judge Raslavitch has now set a September 14th deadline for the prospective buyer to work out differences. He says despite the contentious 18-month struggle through bankruptcy, he’s confident the buyer and dissenting unions could work out their differences to close the deal.
Teamsters Local 628, representing drivers, was most vocal in opposing the new owners’ intention to switch to a 401(k) plan. That would end decades of company contributions to their defined benefit pension plans.