Sun-Times to hold auction with Tyree as lead bidder; union intact

Sun-Times Media Group Inc., the bankrupt publisher of the Chicago Sun-Times, won court approval to hold an asset auction where a group led by James C. Tyree will be the lead bidder with an offer valued at $26.5 million.

U.S. Bankruptcy Judge Christopher Sontchi approved the Oct. 7 auction today in Wilmington, Delaware. Sontchi will consider approving the sale at an Oct. 8 hearing.

The publisher filed for Chapter 11 bankruptcy protection in March, listing $479 million in assets and $801 million in debt. Sun-Times' bankruptcy followed that of Tribune Co., owner of the Chicago Tribune and Los Angeles Times, as plunging advertising sales hindered its ability to make debt payments.

Tyree's group has offered $5 million in cash and would assume about $21.5 million of Sun-Times debt, Sun-Times lawyer David Agay said today. Tyree, chief executive officer of Mesirow Financial Inc, told Bloomberg Television Sept. 11 that his group's offer might save 1,200 or more "nicely paying jobs."

The judge also said bidders can't demand quick concessions from labor unions in order to close the sale.

Tyree has threatened to walk away if the unions don't approve several labor concessions by Sept. 29.

The judge noted Thursday that the sale doesn't have to close until early December. He said if Tyree walks away two or three months before closing, he would be liable for not acting fairly and in good faith.

The judge also rejected the idea that competing bids involving liquidating the company could not be accepted.

The case is In re Sun-Times Media Group Inc., 09-11092, U.S. Bankruptcy Court, District of Delaware (Wilmington).