Tierney & Co. Add $20M To Their Bid For Inky/DN

 phillykeepitlocal.jpgINQUIRER: Three local investors allied with newspaper publisher Brian P. Tierney are adding more than $20 million to their offer for the Daily News and Inquirer.The three local investors – businessman Bruce Toll, philanthropist David Haas and the Carpenters Union Pension Fund – had previously offered $52 million in cash and credit as part of a reorganization plan to bring the newspapers out of bankruptcy. The plan called for the newspapers’ lenders to receive $37 million in cash and ownership of the newspaper building at Broad and Callowhill streets, valued at $29 million. The original proposal would have paid about 21 cents on the dollar to secured creditors holding $318 million in debt – most of the money that Tierney, Toll and other investors borrowed to buy the Philadelphia papers from McClatchy Newspapers in 2006. Under the new proposal, delivered last night, the investors have offered to pay another $20 million to the secured lenders over the next five years, and to split 50/50 any profits that the newspapers make over the five-year period. MORE

PREVIOUSLY: A bankruptcy judge’s ruling has dealt a serious setback to the bid by Brian P. Tierney and his allies to keep control of The Philadelphia Inquirer and The Daily News, increasing the odds that a group of private equity funds and banks will become the papers’ new owners. The papers are likely to be put up for auction to resolve the bankruptcy, and in such an auction, the law generally allows senior creditors to bid the amount they are owed, without putting up cash. In this case, that means the banks and equity funds could make a “credit bid” of about $300 million. That is far more than the $66 million in cash and real estate bid by a group of local investors assembled by Mr. Tierney, the paper’s chief executive. No other bidder has emerged so far.  MORE

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