Monday, October 5, 2009

Time's Up! We Have One Bidder

Posted By on 10.05.09 at 06:42 PM

The 5 o'clock deadline for bidding on the assets of the Sun-Times Media Group expired Monday, and no second bidder came forward.

"Therefore," said interim CEO Jeremy Halbreich in a memo to his 1,800 troops, "on Thursday we will ask the Bankruptcy Court to approve the previously announced sale of the Company's assets to the buyer group led by Jim Tyree."

A second bidder was never actually expected, but there were rumors. Tom Thibeault, executive director of the Chicago Newspaper Guild, said he'd had recent meetings with someone he wouldn't name who was thinking of making an offer.

Tyree, CEO of Mesirow Financial, heads an investment group that's bid $5 million to take over the STMG assets plus more than $20 million in debts that accompany them. Wanting a free hand if he's to try to resurrect the bankrupt company, he's demanded drastic contract concessions that have been rejected in lop-sided votes by five guild bargaining units. Various crafts unions have approved Tyree's offer.

But negotiations continue. Thibeault spent most of Monday at the STMG headquarters on N. Orleans trying to reach terms that his members can tolerate. Halbreich's memo says he's still confident that Tyree's conditions — "including the approval of all of the required union contract amendments, will be in hand before we appear before the Court."

If they're not, the judge could give Tyree and the guild more time. But Halbreich has said repeatedly that STMG is burning too much cash to survive until December, which is when Tyree could formally back out of the deal. As an alternative, the judge could order the company liquidated.

Here's a pdf of Halbreich's complete memo.

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