The Tribune Company went into Chapter 11 bankruptcy protection in December and is now in negotiations with its creditors, who own $8.6bn in senior debt, to reorganise the company.
The reorganisation could take it out of the hands of billionaire Sam Zell and put it under the control of banks and investors.
The Chicago Tribune, which is owned by Tribune, reported that the plan centred on a debt-for-equity swap, which would give the banks majority ownership as the newspaper company struggles to meet payments on its $13bn of debt.
According to the paper, Zell would lose a $90m warrant, which the billionaire negotiated as part of his $8.2bn deal to buy the company and take it private in 2007.
The warrant gave Zell the right to buy around 40% of the company for $500m.
Zell also holds a $250m note representing a loan he made to the company as part of taking the company private.
However, that note is near the bottom of the pile of claims against Tribune Co's Chapter 11 bankruptcy case and is unlikely to retain any value.
The reorganisation could also see the controversial figure Zell and his management team kicked out.
Zell made his fortune in retail, buying up property in the US when commercial lending on property was hard to come by. He is also the largest mobile-home landlord in the US.
In a statement, reported by the Chicago Tribune, Tribune Company said that Zell and his top managers "remain actively engaged and committed to this company. The restructuring is still in progress, and it is premature to speculate about the final ownership structure."
The deal has come about as Tribune Company can not afford the almost $13bn in debt, which grew out of Zell's $8.2bn takeover deal.
The situation has been exacerbated by falling ad revenues and depleted cash flow.
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