Creditors want to slow Tribune's bankruptcy exit

WILMINGTON, Delaware (Reuters) - A group of creditors has requested that the hearing to approve Tribune Co's TRBCQ.PK plan of reorganization be delayed at least three months to give it more time to digest a 1,000-page report by a court-appointed examiner, according to court documents.

The creditors requested a delay of at least 90 days, which could push the bankruptcy beyond the two-year mark.

The agent for a $1.6 billion loan said in a Friday filing that it was unrealistic to stick to the August 30 scheduled start of hearings to confirm the reorganization of the publisher of the Chicago Tribune and Los Angeles Times.

Tribune filed for bankruptcy in 2008, a year after real estate developer Sam Zell led a buyout that saddled the company with debt.

The company, which also owns TV stations and other properties, has proposed turning ownership over to lenders with about $8.7 billion of claims. In return for ending potential legal fights, the company has proposed giving senior bondholders about $450 million.

The bridge loan holders would get almost nothing for their claims and more than $1 billion in junior bonds would be wiped out.

In their argument for the delay, the bridge loan agent noted that preparations for the confirmation hearing was delayed because many witnesses did not want to give depositions until the examiner filed his report, which was released under seal last week.

On Thursday, parties to the case got access to the report. It runs more than 1,000 pages and contains more than 20,000 pages of exhibits, according to the bridge agent.

"Just digesting and assessing the examiner's report will take up a meaningful portion of the approximately 30 days left before the confirmation hearing," the filing said.

The examiner's report found that billions of dollars of high-priority loan claims against Tribune could potentially be voided as could approximately $4 billion in payments made to shareholders in 2007, according to the bridge agent.

Voiding those claims would increase the potential recovery for the holders of the bridge loan.

The case is In re: Tribune Co et al, U.S. Bankruptcy Court, District of Delaware, No. 08-13141.

(Reporting by Tom Hals. Editing by Robert MacMillan)