• by David Goetzl  @dgoetzl, July 15, 2009

After reaching out to 66 potential buyers and finding minimal interest, a group of Young Broadcasting's bankers are expected to take control of the station group for about $220 million.

A company attorney told a court Wednesday the lenders' bid is about $100 million more than two other groups were willing to pay and asked the court to approve the sale next week.

Young is then expected to fall under the ownership of the collection of lenders later this year. The group submitted a $200 million bid for the company's assets, while agreeing to take on between $19 million and $20 million in expenses. The deal will not become official until it is approved by the FCC.

Two additional bidders each offered $120 million for the assets. One group put forth a joint bid, where one entity would take over two of Young's 10 stations, while the other would assume control of the remaining eight.

On Wednesday in New York federal bankruptcy court, Young attorney Peter Wolfson did not identify the bidders offering $120 million. Wolfson said Young asked both to increase their bids to $200 million to put them on par with the lenders, but both groups declined.

Wolfson, from New York firm Sonnenschein, Nath & Rosenthal, said a fourth party indicated it would be willing to bid $215 million, but asked for more time. Young opted to eliminate it from the process.

The $200 million bid comes almost a decade after Young purchased one of its stations -- what is now the San Francisco MyNetworkTV affiliate KRON -- for $823 million. The acquisition proved to be a drag on company performance, and Young has tried and failed to sell it. Young filed for bankruptcy in February as it grappled with hundreds of millions of dollars in debt.

Besides KRON, Young's portfolio includes the ABC affiliates in Nashville, Tenn., Albany, N.Y. and a CBS affiliate, KELO, with wide reach in the Dakotas.

When the lenders take control of Young's stations, the group is likely to restructure the company, including installing a new board of directors. Vincent Young currently serves as both board chairman and CEO; it is unclear whether he will continue in either or both of those positions.

A call to Young was not immediately returned.

The lenders would be free to run the company and ride out the crippling advertising recession, then sell it or execute a public offering. Young posted a net loss of $370 million in 2008.

The lenders emerged as the highest bidder after Young's adviser UBS reached out to 66 potential buyers to gage their interest. Seventeen received presentations from management en route to the three bids that Young ultimately deemed credible.

It is widely acknowledged that the once-hot market for buying and selling local stations that had Young paying a high price for KRON in 2000 has cooled. With the ad market in a tailspin, station owners have struggled to get the value sought and pulled many off the market. Earlier this year, a court filing by Young's unsecured creditors said station "values have fallen to (30-year) lows."