Tribune strikes deal with Angelo Gordon, Oaktree to settle some bankruptcy claims

Bankrupt newspaper publisher Tribune Company has reached an agreement with two hedge funds that would settle some claims related to its 2007 leveraged buyout and clear the way for it to exit Chapter 11.

Tribune said it agreed with Oaktree Capital Management and Angelo, Gordon & Co LP to a plan of reorganization which would leave the two hedge funds with significant ownership stakes in the company. The plan also would allow the owner of the Chicago Tribune, Los Angeles Times and nearly two dozen television stations to exit bankruptcy before resolving a complex web of legal claims. The deal would need approval of Delaware's bankruptcy court. Under the settlement, Tribune senior bondholders would receive a total distribution of $300 million, or about 23 percent of their claim amount, in cash. In addition, Tribune said the bondholders would receive a portion of a trust that will be set up to pursue legal action over the second part of Zell's takeover deal.