CINCINNATI -- An insiders group cannot complete its bankruptcy auction purchase of the Ohio-based newspaper chain Brown Publishing Co. because the group's lender withdrew, the company said in a court filing.
Brown Publishing is the majority owner of the Charleston Regional Business Journal.
A federal bankruptcy judge last month ruled that the newly formed Brown Media Corp., led by current Brown Publishing president and chief executive Roy Brown, could buy the majority of the chain for $22.4 million.
Brown Publishing filed for bankruptcy in May.
The company said in a court filing Friday that Brown Media Corp. on Aug. 18 confirmed it "lacked the financial ability to close at this time" because "its lender has withdrawn." The lender was not identified.
The filing said that Brown Publishing has begun discussions with PNC Bank as the next highest bidder and thinks it "will be in a position to close an asset sale transaction with PNC."
PNC, which led the group of the chain's senior creditors, has said it hopes to close no later than Sept. 3, the filing said. PNC spokesman Pat McMahon said Monday that he could not comment beyond the court filing.
The filing did not indicate how much PNC bid.
Brown Publishing also asked the court to allow it to continue using cash collateral to operate through Sept. 3. The company said it would be forced to shut down operations if the court does not authorize continued use of the cash collateral.
In South Carolina, Brown Publishing is majority owner of SC Biz News LLC, which publishes the biweekly Charleston Regional Business Journal and the Columbia Regional Business Report. Brown Publishing also owns Upstate Business LLC.
The Post and Courier contributed to this report.