Brown Publishing, bank reject attempt to stop credit bid in bankruptcy auction
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In a story this week by Mark Fitzgerald, editor of www.editorandpublisher.com, "Brown Publishing Co. and its biggest bank lender have accused unsecured creditors of making last-minute, unsubstantiated claims in seeking to prevent the bank from using its debt to bid on the bankrupt Cincinnati-based newspaper publisher.
"In separate papers filed in U.S. Bankruptcy Court in Central Islip, N.Y., Brown Publishing Co. (BPC) and PNC Bank said there was no merit to claims by the official committee of unsecured creditors that the debt taken on by entity owned by Brown Publishing CEO Roy Brown and other company insiders made the deal a 'fraudulent conveyance,' that is, the entity, Brown Media Holdings Co., was insolvent from day one, PNC Bank knew it, and therefore it shouldn’t be allowed to use its debt to make a 'credit bid' for Brown Publishing 15 dailies and numerous other papers and business publications."
PNC said the committee has not provided any evidence to substantiate its claims.
PNC is owed more than $74 million by Brown Publishing, and has said it will make a $20 million credit bid for the company by the July 16 bid deadline.
Roy Brown's three-year-old separate company, Brown Media, has made an opening bid of $15.9 million for BPC, which claimed a book value of $94.1 million when it filed for bankruptcy May 1. BPC listed $104.6 million in debts, EditorandPublisher.com reported.
"Judge Dorothy Eisenberg has previously approved an auction sales plan that would allow PNC to make a credit bid, and without putting up a 5% cash deposit required of other bidders, including Roy Brown’s group. But after the unsecured creditors filed on Monday asking for a hearing on prohibiting a credit bid, the judge quickly agreed," E&P said.
A hearing was set for July 15 in New York.
Brown Publishing owns The Times-Gazette and County Shopper in Hillsboro, as well as newspapers in surrounding counties, including: The Wilmington News Journal and Star Republican, The Record Herald in Washington C.H., The People's Defender in West Union, The News Democrat in Georgetown and The Ripley Bee.
For more information, go to www.editorandpublisher.com.[[In-content Ad]]
"In separate papers filed in U.S. Bankruptcy Court in Central Islip, N.Y., Brown Publishing Co. (BPC) and PNC Bank said there was no merit to claims by the official committee of unsecured creditors that the debt taken on by entity owned by Brown Publishing CEO Roy Brown and other company insiders made the deal a 'fraudulent conveyance,' that is, the entity, Brown Media Holdings Co., was insolvent from day one, PNC Bank knew it, and therefore it shouldn’t be allowed to use its debt to make a 'credit bid' for Brown Publishing 15 dailies and numerous other papers and business publications."
PNC said the committee has not provided any evidence to substantiate its claims.
PNC is owed more than $74 million by Brown Publishing, and has said it will make a $20 million credit bid for the company by the July 16 bid deadline.
Roy Brown's three-year-old separate company, Brown Media, has made an opening bid of $15.9 million for BPC, which claimed a book value of $94.1 million when it filed for bankruptcy May 1. BPC listed $104.6 million in debts, EditorandPublisher.com reported.
"Judge Dorothy Eisenberg has previously approved an auction sales plan that would allow PNC to make a credit bid, and without putting up a 5% cash deposit required of other bidders, including Roy Brown’s group. But after the unsecured creditors filed on Monday asking for a hearing on prohibiting a credit bid, the judge quickly agreed," E&P said.
A hearing was set for July 15 in New York.
Brown Publishing owns The Times-Gazette and County Shopper in Hillsboro, as well as newspapers in surrounding counties, including: The Wilmington News Journal and Star Republican, The Record Herald in Washington C.H., The People's Defender in West Union, The News Democrat in Georgetown and The Ripley Bee.
For more information, go to www.editorandpublisher.com.[[In-content Ad]]