Posted on Fri, Nov. 13, 2009
A scheduled auction to sell the
Daily News and
Inquirer to the highest bidder was postponed for a week yesterday by a federal judge, to permit the U.S. Third Circuit Court of Appeals to consider an issue in the newspapers' bankruptcy proceedings.
The issue is whether the papers' secured creditors will be able to use up to $318 million in IOUs to submit a bid for the newspapers, a practice known to bankruptcy mavens as "credit bidding."
U.S. District Judge Eduardo C. Robreno ruled this week that Philadelphia Newspapers L.L.C., the owner, is permitted to ban credit bidding in an auction set up to push the newspapers through a bankruptcy reorganization.
The auction had been scheduled for Wednesday, but Robreno granted a one-week delay so that lenders could appeal his ruling.
The new date for the auction will depend on how the Third Circuit handles the appeal.
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