Bankruptcy Judge Approves Sale of UPI



Here is an "urgent" filed by Greg Gordon on June 10, 1985, on the sale of UPI out of bankruptcy:

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WASHINGTON (UPI) -- A federal bankruptcy judge Tuesday approved the sale of United Press International to Mexican publisher Mario Vazquez-Rana, who pledged to do everything possible "to make UPI the best news agency in the world."

In confirming the sale, U.S. bankruptcy judge George Bason praised UPI for a "truly extraordinary" recovery during 13 1/2 months of Chapter 11 proceedings.

"I'm enormously pleased and I believe that its future now is assured for the foreseeable future," Bason said.

In month-long balloting, UPI's largest creditors voted 130-5 to support the $36 million to $40 million sale, which is expected to return about 45 cents of every dollar owed to major vendors and to fully repay employee claims and provide UPI with $15 million in working cash.

Lawyers had hoped to close the sale Tuesday, but a company attorney said that because the confirmation hearing extended into the afternoon the deal would not be made final until Wednesday.

Vazquez-Rana, appearing in court at Bason's request, testified through an interpreter that he has placed more than $29 million in a Washington bank to complete the transaction.

He said he is aware UPI has been losing money -- company officials project losses of $5.2 million this year -- but he said owning the news service is "one of the greatest dreams that I have."

Vazquez-Rana, who owns 62 newspapers in Mexico and serves as president of his nation's Olympic Committee, renewed pledges to ensure the editorial integrity of UPI, to always maintain its world headquarters in the United States and to "always guarantee" that its principal officers will be Americans.

Stressing UPI is "very rich in human elements," he said, "in the business world, if you lose money or make money, that may not be the most important thing."

"I will do everything I can to make UPI to best news agency in the world," Vazquez-Rana said.

Bason turned to the new owner, who has taken Texas businessman Joe Russo as a 10 percent partner, and said, "Somebody tried to tell me how to say good luck in Spanish. I can't remember, so I'll say it in English, good luck."

Richard Levine, UPI's chief bankruptcy lawyer, praised chairman Luis Nogales for guiding the nation's second largest news service through countless crises during the last year.

Nogales told the court that "only 9 percent of all companies that file for bankruptcy make it out" and that for large companies the process can take two years or more. "We didn't think UPI could survive (in bankruptcy) for two years," he said.

"What we found is that our employees were extremely loyal, talented and dedicated . . . and we also found that we had very loyal clients, we had friends among creditors. Many of the large creditors displayed tremendous corporate responsibility."

Lauding the judge, he stepped to the bench to hand Bason a blue "UPI victory tie" being distributed, along with scarves, to employees worldwide.

Bason, appearing to be teary eyed, replied, "I'm overwhelmed."

UPI 6-10-86 02:52 PCD

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