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Hollinger Canadian bankruptcy case recognized by U.S. court
By Caroline Salls
Pittsburgh, Aug. 28 - Hollinger Inc.'s Companies' Creditors Arrangement Act proceedings in Canada were officially recognized by the U.S. Bankruptcy Court for the District of Delaware, according to a Tuesday court filing.
As previously reported, the company's Canadian subsidiaries, 4322525 Canada Inc. and Sugra Ltd., entered the CCAA proceedings in Canada when Hollinger filed its Chapter 15 bankruptcy case in the United States.
On Aug. 10, Hollinger obtained a preliminary injunction in its Chapter 15 case to keep some noteholders from taking over the company's assets and standing in the way of the formulation of a CCAA bankruptcy plan.
At that time, judge Peter J. Walsh extended a protective order that prevents bondholders from seizing shares of Sun Times Media Group, Inc. during the Canadian bankruptcy proceedings.
In his ruling, Walsh wrote that, without the restraining order, "there is a material risk that the debtor's assets located in the United States could be subject to attack by creditors."
Hollinger has also been granted a stay of proceedings by the Ontario Superior Court of Justice.
The company had said it needed protection in the United States to allow it to implement a strategy for its Sun Times shares that will allow it to maximize creditor recovery and negotiate with claimants who will come forward in response to the CCAA proceedings in the view of ultimately formulating a bankruptcy plan.
Toronto-based Hollinger's principal asset is Hollinger International, which is a newspaper publisher that owns the Chicago Sun-Times. The CCAA proceedings and Chapter 15 bankruptcy were both filed on Aug. 1. Hollinger's Chapter 15 case number is 07-11029.
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