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The McClatchy newspaper chain, owner of publications like the Miami Herald and the Kansas City Star, is closer to transferring ownership to its largest shareholder.

New Jersey-based hedge fund Chatham Asset Management was the successful bidder in a bankruptcy auction in connection with its bankruptcy, McClatchy said in a statement. Press release Sunday.

McClatchy filed for Chapter 11 bankruptcy protection in February after facing a pension crisis and the financial challenges of the information industry. The file was deposited before the COVID-19 pandemic, which affected the press companies of the country.

The McClatchy family have controlled the Sacramento, California-based company for over 160 years. The statement said the proposed agreement will be finalized and filed with the United States. Bankruptcy court in the coming days.

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Since McClatchy’s 2006 acquisition of the Knight-Ridder newspaper chain, which was purchased with $ 5 billion in debt, the company has suffered from the same factors that affect traditional news media companies.

McClatchy “will exit Chapter 11 as it enters: all of it, as a business serving 30 communities across America,” the statement said. Its other properties include The Charlotte Observer and The Sacramento Bee.

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“From the start of this voluntary Chapter 11 filing, our goal was to continuously process both the company’s debts and retirement obligations and strengthen our balance sheet to provide greater certainty and stability in the future. larger group of our colleagues and stakeholders who benefit from a restructured McClatchy, “said Craig Forman, president and chief executive officer of the newspaper chain, in the release.

The company said it hopes to leave Chapter 11 in the third quarter of 2020 “after reaching resolution and restructuring of the company’s complex debts and retirement obligations, while maximizing the value for the company’s creditors” .

A bankruptcy hearing is scheduled for July 24.

Contributor: Nathan Bomey

Follow USA TODAY reporter Kelly Tyko on Twitter:@KellyTyko

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