LOS ANGELES (AP) — The owner of the Los Angeles Times on Wednesday offered to loan $3 million to the bankrupt owner of a rival Southern California newspaper, a move that could set the stage for a bidding war.
Chicago-based Tribune Publishing told a federal bankruptcy judge that it's willing to loan Freedom Communications the money for day-to-day operations — with the money counting in any bid Tribune might make for Freedom's assets.
Freedom, which owns the Orange County Register and the Riverside Press-Enterprise, filed for Chapter 11 bankruptcy protection on Sunday. It lost more than $40 million in two years during a rapid expansion under former CEO Aaron Kushner, who started newspapers in Los Angeles and Long Beach that were later closed.
Tribune, which also owns the San Diego Union-Tribune, Chicago Tribune and Baltimore Sun, is a Freedom creditor. Another creditor, the hedge fund Silver Point Capital, also is offering $3 million in financing to Freedom, according to The Times, (http://lat.ms/1WxeiI3 ).
Tribune attorney Jeremy Rosenthal objected to Silver Point's offer, telling U.S. Bankruptcy Court Judge Mark S. Wallace that Tribune wants an "opportunity to bid at a fair, open, transparent proceeding."
Tribune spokesman Matthew Hutchison declined to comment further on the company's plans. A Silver Point spokesman declined to comment.
The Times reported that Tribune's offer is the strongest indication yet that the company may consider buying the Register and The Press-Enterprise.
Information from: The Orange County Register, http://www.ocregister.com