Court OKs Grant Broadcasting Bid to Cut Some TV Show Debt

A ruling by a federal bankruptcy judge Thursday moved Grant Broadcasting System a step forward in its efforts to shed some of its $225 million in debts to television program distributors.

Bankruptcy Judge David Scholl in Philadelphia approved the three-station television broadcast chain’s request for approval of a renegotiated contract with Viacom International.

The contract cuts Grant Broadcasting’s long-term obligations to the distributor to $28.7 million from $35.9 million and stretches the repayment period to 6 1/2 years from about 3 1/2.

Viacom’s huge library of reruns could provide as much as two-thirds of the three Grant stations’ programming needs. The agreement thus gives the company leverage in its bargaining with other distributors to renegotiate contracts for future programming, said Marc J. Sonnelfeld, Grant Broadcasting attorney.

Grant “is now assured of having the bulk of what it will need,” he said. “This really puts us in a favorable position.”

Grant Broadcasting became the largest television broadcast concern to seek bankruptcy court protection when it filed a voluntary Chapter 11 petition under the U.S. Bankruptcy Code last Dec. 9.

The program distributors, including major Hollywood studios, are strenuously resisting its efforts to pare its huge obligations to them.

Earlier this month, a group of such distributors moved for appointment of a trustee to run the broadcast concern, which has stations in Miami, Philadelphia and Chicago. They charged the company’s executives with self-dealing and mismanagement that squandered a hoard of cash raised in a bond issue only last year.

But Milton Grant, the chain’s founder and chief executive, said those charges were raised only to lend support to the creditors’ motion for appointment of a trustee. “We are good kids. We play it straight,” he said.