Philly newspaper creditors seek control

October 1, 2009 10:03:06 AM PDT
Creditors out $400 million with the bankruptcy of Philadelphia Newspapers will be in court Thursday trying to win control of the company.

Philadelphia Newspapers operates The Philadelphia Inquirer, Philadelphia Daily News and the Web site.

Local investors bought the company three years ago but have struggled amid the industry-wide collapse.

The senior lenders are competing in the bankruptcy auction with a $67 million bid by a mix of current and new investors. Their bid includes $37 million in cash plus the headquarters building and parking lot.

That's a fraction of the company's $515 million sale price in early 2006.

Creditors will argue Thursday for the right to "credit bid," using some of the money owed them.