There will be no Philadelphia story for the warring Perelman family.
Jeffrey Perelman, the Philadelphia businessman and philanthropist who heads investment firm JEP Management, has submitted a bid to buy the Philadelphia Inquirer, the Philadelphia Daily News and the related Web properties, sources said.
His father, 94-year-old Ray Perelman, along with his brother, New York financier and Revlon boss Ron Perelman, had tried to enter the bidding in February but were blocked from doing so. Jeffrey Perelman is bitterly estranged from both.
“Jeffrey Perelman is there,” said the source, who called it a “weak bid.”
Former Philadelphia Gov. Ed Rendell, who had put together a group of investors to buy the papers, is still in the hunt. According to Politico, Rendell said that “the bids went in today.” In reality, the bids were due Thursday.
Rendell’s financial backers include parking lot magnate Lewis Katz, Philadelphia Flyers’ owner Ed Snider and Democratic power broker George Norcross III.
Rendell, who was putting up no money personally, has said his backers are interested in buying the papers out of a sense of civic duty and to return them to local ownership.
Investment bank Evercore was hired in December to handle the auction after Greg Osberg, the president of the papers’ parent company, the Philadelphia Media Network, approached Rendell in October and asked him to put together a buyout group.
Angelo Gordon and Alden Capital, two of the hedge funds that bought the papers out of bankruptcy in 2010, decided they wanted to unload the papers, which had consistently missed earnings targets.
In 2011, the company had revenue of around $200 million but an operating profit of just $4 million, according to one source.
Brian Tierney, a Philadelphia public relations executive, purchased the papers in 2006 for $515 million, only to file for Chapter 11 two years ago, citing more than $300 million in debt.
The current hedge-fund owners paid $139 million. Ray Perelman was the underbidder in the 2010 sales process.
The current investors are believed to be looking for at least $100 million based on projected 2012 earnings of $20 million.
Other handicappers are saying that since the papers only cleared $4 million last year, they would command a far lower price.