Young Broadcasting creditors committee objects to proposed process to pursue sale, plan investment

By Jennifer Lanning Drey

Portland, Ore., March 30 - Young Broadcasting Inc.'s official committee of unsecured creditors objected to the proposed bid procedures for an investment in the company's plan of reorganization or in connection with a sale of its assets, according to a Monday filing with the U.S. Bankruptcy Court for the Southern District of New York.

The creditors said the dual-track process proposed by the company "makes little sense from an economic or practical perspective."

The committee believes the process is designed to result in a false market test that will one day be used by the pre-petition secured lenders to justify a claim that there is no value beyond their secured claims.

In addition, they said the company has selected the "worst time in recent history" to sell assets, as values for domestic media companies have fallen to 30-year lows.

They also noted that the bid procedures look to authorize a credit bid from the pre-petition secured lenders as a potential stalking horse bid.

As previously reported, Young said it believes it to be in the best interests of its estates and creditors to pursue a dual-track process that concurrently solicits bids for either a potential refinancing or equity investment in its plan or the sale, as a going concern, of all or a part of its businesses and/or assets.

New York-based Young Broadcasting owns 10 television stations and the national representation firm Adam Young Inc. The company filed for bankruptcy on Feb. 13. Its Chapter 11 case number is 09-10645.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.