Next Tuesday, both the Philadelphia Inquirer and the Philadelphia Daily News will go up for auction as they attempt to emerge from bankruptcy.
If Philadelphia housing executive Bruce Toll and other local investors are able to place a winning bid, there is a good chance the papers could remain in Philadelphia while chipping away at its $318 million debt. Toll and others had first bought the company back in 2006 for $515 million, but both papers have since experienced a steep decline in advertising revenue.
Other companies — and the papers’ creditors — are also expected to place bids next week.
How much will they be expected to shell out?
Philly.com, which is also owned by the papers’ parent company, Philadelphia Newspapers LLC, points out that this auction will effectively set a value for the two papers. Last year, the company’s senior lenders dismissed an offer of $67 million in cash and property to settle their debt.
The current value on the table, from a local group of investors, is $80.5 million. The lenders themselves have valued the company at around $85 million, an estimate which many outside the company have deemed “generous” based on performance and industry standards.