Judge OKs $139M court sale of Philly newspapers

(AP Photo)

September 30, 2010 1:20:06 PM PDT
A bankruptcy judge has approved the sale of Philadelphia's two largest newspapers to creditors.

The sale is valued at about $139 million, including $105 million cash and the iconic newspaper building.

The senior lenders are essentially paying themselves.

All of the approximately 30 banks and hedge funds holding the company's secured debt have now agreed to retain ownership stakes. They include the hedge fund Angelo Gordon and Citizens Bank.

Creditors plan to close the sale by Oct. 8 after a bitter 20-month bankruptcy fight.

They must still forge a contract with drivers concerned about their Teamsters pensions.

Newsroom employees have agreed to 6 percent pay cuts as the new owners try to cut costs by 13 percent across the board.