U.S. bankruptcy court clears way for sale of Cubs

People standing in Freedom plaza, adjacent to the Chicago Tribune, look at the Tribune tower in Chicago, Illinois December 8, 2008.

WILMINGTON, Delaware (Reuters) - The Ricketts family received court approval on Thursday to acquire the Chicago Cubs baseball team for $845 million from the Tribune Co, a media conglomerate that is trying to emerge from bankruptcy.

Tribune will transfer the Cubs, Wrigley Field and its stake in a sports television network to a new company. The Ricketts family, which made its fortune from the TD Ameritrade Holding Corp business, will contribute $845 million to the new company and have 95 percent control.

As part of the transaction, the Cubs are expected to file for bankruptcy on October 12 to shed any claims by creditors of Tribune, according to Bryan Krakauer, an attorney for law firm Sidley Austin, which is representing the Tribune.

"All that is left is for the owners to officially vote on the transaction. We've been informed it could happen as soon as October 5," Krakauer said. "We have every reason to believe it will be approved."

The sale has been structured as a transfer and at one point during the hearing Krakauer corrected Judge Kevin Carey to remind him the transaction was not a sale.

The deal is designed to be recognized as a disregarded transaction for tax purposes, potentially allowing the Tribune to avoid paying tax on the gain in value of the team.

The Tribune, which also owns the Chicago Tribune and Los Angeles Times newspapers, bought the Cubs in 1981 for $20.5 million.

The Washington Post reported that a leading tax specialist expects federal authorities to challenge the deal's status.

After certain adjustments, Tribune expects to end up with $740 million and a 5 percent stake in the new company that will own the Cubs. That money will go toward paying off Tribune's debt, which was estimated at nearly $13 billion when it filed for bankruptcy last year.

The company has been trying to sell the team since real estate magnate Sam Zell bought Tribune in 2007 in a leveraged buyout.

Former Cubs All-Star shortstop Shawon Dunston entered the only objection to the deal. Dunston, who was drafted by the Cubs out of high school, said in court papers he objected because the team owed him scholarship money if he decided to attend college. He withdrew his objection.

The Tribune has said it hopes to exit bankruptcy this year, although it still faces challenges.

Bondholders have asked for an investigation of the banks and lenders that funded the $11.2 billion buyout. The bondholders fear the Tribune will propose turning over the company to those lenders and leave them with virtually nothing.

Bondholders got a boost on Wednesday when the company and some creditors agreed to turn over documents and emails relating to the buyout, which the bondholders said amounted to a fraudulent transfer.

If proven, it could increase the bondholders recovery by reducing secured claims that normally would get paid ahead of them.

The case is In re Tribune Co, US Bankruptcy Court for the District of Delaware No. 08-13141.

(Editing by Maureen Bavdek; editing by Andre Grenon)