Secured creditor group says it is not on board with proposed Tribune bankruptcy settlement

Lenders say Tribune bankruptcy resolution unfair

DOVER, Del. — A group of secured creditors is challenging the Tribune Co.’s plan to emerge from Chapter 11 bankruptcy.

Holders of more than $3.6 billion of claims under a 2007 secured credit agreement said in a court filing Monday that the announcement of a deal that Tribune struck with other creditors was premature and misleading.

The lenders said that without their support, the purported global settlement Tribune announced last week is “dead on arrival.” Tribune said the settlement would avoid all potential claims related to a leveraged buyout in 2007 that left the company mired in debt.

The lenders argue that they would bear the entire burden of the proposed settlement by giving up more than $400 million in value to bondholders and other unsecured creditors.