Tribune Co., parent company of the Los Angeles Times, KTLA-TV Channel 5, and other various media outlets, is trying to buy more time to negotiate with its creditors before having to propose a reorganization plan in bankruptcy court.
The company has already filed four extensions, but thanks to a loophole in Delaware law, the company can file for an extension to freeze the exclusivity period until the next scheduled court hearing, which happens to be April 13.
Tribune has been holding off, trying to broker some sort of deal between its senior creditors and junior bondholders. The senior creditors, which include JP Morgan Chase and multiple hedge funds and distressed debt investors, feel that since the company's value has fallen far below $5 billion, their claims should be satisfied first. On the other hand, two groups of the junior bondholders, who have more than $2 billion at stake, say they were improperly subordinated to the senior lenders.
Despite filing for an extension, the company still hopes to have reached an agreement before this month's hearing.
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