Inner City Media sets asset sale procedures; lenders submit offer

By Caroline Salls

Pittsburgh, Dec. 20 - Inner City Media Corp. requested court approval of bid procedures for the proposed sale of substantially all of its assets, according to a Monday filing with the U.S. Bankruptcy Court for the Southern District of New York.

The company said its cash collateral order required it to file a motion for approval of the bid procedures by Dec. 19.

A new limited liability company to be organized by Inner City Media's senior lenders will serve as the stalking horse bidder.

The amount of the stalking horse bid was not disclosed, but the bid will include a partial credit bid of consenting lenders' claims, a cash payment and cash needed to fund professional fees and wind-down escrows.

In addition, the lenders have been in negotiations with non-debtor Inner City Broadcasting Corp., which is Inner City Media's largest shareholder.

The company said the parties are negotiating an agreement under which Inner City Broadcasting would agree to assign specified trademarks, patents, copyrights and other intellectual property to the stalking horse bidder in exchange for a $2.75 million payment.

Bids are due by 5 p.m. ET on Feb. 13. The auction will be held on Feb. 16, and the sale hearing is scheduled for Feb. 21.

Qualified bids for all of the company's assets must exceed the value of the stalking horse bid by at least $500,000.

A hearing on approval of the bid procedures is scheduled for Jan. 9.

Inner City Media is a New York-based radio company. An involuntary bankruptcy case was filed against it on Aug. 19. The Chapter 11 case number is 11-13697.

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