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Philadelphia newspapers’ new owners keen to settle unresolved union contracts

The financial consortium behind the take over want to sign all 14 union contracts before closing the

Creditors who won the bankruptcy auction for Philadelphia's two largest newspapers - the Philadelphia Inquirer and Philadelphia Daily News - are keen on settling the remaining unresolved union contracts before closing the $139m sale.

While the Chief US Bankruptcy Judge has recommended closing the sale by Tuesday, the new owners -- a financial consortium led by the hedge funds Angelo Gordon & Co, Alden Global Capital and CIT Group Inc -- are particular about signing all 14 union contracts before the close. However, some contracts remained unsigned on Monday.

Union contracts by newspaper delivery-drivers are understood to be one of the unsigned ones. They have rejected an offer from the new owners to provide a 3 per cent match of individual 401k contributions, reportedly on fears of losing their defined pension contributions.

However, reporters, photographers and other members of the local Newspaper Guild accepted concessions including a 2 per cent wage cut and two weeks of unpaid leave each year of the three-year contract, in return for a promise from the new owners to avoid newsroom layoffs for at least a year.

Other union employees such as the mailers, porters, security guards, and mechanics have also accepted the new contract offers.