The finance chief of the Tribune Co. answered questions posed by an attorney for the U.S. trustee about the media giant’s plans for a reorganization plan designed to emerge from bankruptcy. But the CFO, Chandler Bigelow III, provided few details during a hearing in Wilmington, Del., attended by the bankruptcy trustee and creditors.
Bigelow’s Friday testimony, shed little light as well on the company’s plans to sell the Chicago Cubs baseball team. “We continue to work very, very hard to maximize the value of those assets and feel like we’re making progress, and we’re doing everything we can to drive liquidity into the company,” Bigelow said, according to an Associated Press report. “When we have something to announce, we will publicly announce it.”
Under questioning from the attorney, Joseph McMahon Jr., Bigelow was put on the defensive about a solvency opinion issued when real estate magnate Sam Zell took Tribune Co. private in 2007 in a leveraged buyout. Bigelow explained that the deal was completed in two steps, according to the AP. The first stage involved creation of an employee stock ownership plan and an initial purchase of half of the company’s stock for about $4 billion. The second step involved approval by federal regulators and borrowing of about $3.7 billion to purchase the remaining shares.
When pressed, Bigelow said that a solvency opinion was made public in connection with the first phase but that the second solvency report was never publicly filed. “To the best of my knowledge, we had no obligation to publish the second step solvency opinion,” Bigelow reportedly said. The wire service noted that the finance executive deferred additional questions on the issue to Tribune bankruptcy attorney Bryan Krakauer, who indicated the company would eventually provide the information.
Curiously, Bigelow also was unable to provide details about the business purposes of some of the more than 100 Tribune entities involved in its bankruptcy filing, the AP noted.
The AP account noted that Tribune’s bankruptcy case involves 111 of its 128 entities. The Cubs are among the entities that did not file for bankruptcy.
“We’re obviously working very hard for you to put together all the financial information,” Bigelow said, adding that the company has a “relatively decentralized” management structure.
Bigelow, Tribune’s CFO since March 2008, previously was its treasurer. The company credits him for being instrumental in closing Tribunes going-private transaction in December 2007.