US newspaper publisher Tribune Company has reached an agreement with its creditors and lenders that will help it emerge from bankruptcy protection later this year, according to news from Reuters.
Tribune, which publishes the Chicago Tribune and the Los Angeles Times, filed for bankruptcy in 2008. The new agreement settles all potential claims stemming from the 2007 $8.2 billion (£5.4 billion) Tribune leveraged buyout by Sam Zell in 2007.
The agreement has come under criticism from a group of junior boldholders holding $1.2bn (£780 million) of Tribune debt. They claim to have been unfairly cut out of the negotiating process, and have further criticised the make-up of the creditors committee, which includes bank lenders, normally excluded from such groups.
Minnesota’s largest news source, the Star Tribune, was declared bankrupt three months ago and is now in danger of going under. The paper is the largest in the area and the 15th largest in America itself.
Yet another American paper facing closure, it brings to mind the ‘Rocky Road Mountain News’, closed down earlier this year.
“Four major newspaper firms have now declared bankruptcy. The rest of the industry is on the ropes – sources of credit or equity funding have virtually dried up; there is basically no market into which to sell publishing assets to raise cash; the ability to maintain quality and to innovate is seriously hampered by continual cost-cutting necessary to maintain positive cash flow and meet debt service obligations,” Martin Langeveld writes on the NiemanJournalismLab.
Here, Langeveld gives a list of what will and won’t happen. What kind of changes will bankruptcies force on newspapers he asks?
“As expected, The Minneapolis Star-Tribune has filed for Chapter 11 bankruptcy protection, as the newspaper failed to get a key union agreement on cost-containment,” PaidContent reported yesterday. Full story…
Following the news that the Tribune Co. has filed for bankruptcy, ‘journalist turned activist’ and former editor of the Los Angeles Daily News, Ron Kaye, writes on his blog that this is not the end of your daily newspaper.
“It’s just the beginning of the end for hundreds of newspapers and the collapsing of many others into single regional franchises that can survive as the only source of printed news and advertising on a daily basis.”
Kaye, who was fired by the Daily News seven months ago, says ‘Let the conversation begin.’
More on this tomorrow, but just to link today’s (Monday) news that the Tribune Co. has filed for Chapter 11 bankruptcy protection, as reported here by the group’s own newspaper the LA Times, as well as numerous other news sources. The group also owns KTLA Channel 5, the Chicago Tribune, the Baltimore Sun as well as nine other newspapers and 22 other television and radio stations across the country.