Denver Post owner plans prepackaged Ch. 11 filing
Denver, CO Colorado
DENVER – Affiliated Media Inc., the holding company for the MediaNews Group family of newspapers that includes The Denver Post, said Friday that it plans to file for Chapter 11 bankruptcy protection.
The company said it would file a “prepackaged” plan already approved by lenders, which should allow it to emerge from bankruptcy more quickly. A date for the filing hasn’t been announced, but the company said it would be in the near future.
Company management and newspaper operations, employees and vendors won’t be affected by the holding company’s restructuring, MediaNews Group Chairman and CEO William Dean Singleton said. He is the chairman of The Associated Press board of directors.
Under the plan, company debt would fall from about $930 million to $165 million. Senior lenders would swap debt for stock.
Singleton said the company has enough cash to fund its operations.
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Singleton and company President Joseph J. Lodovic IV will keep control of the company by owning all of its class A shares. Management led by Singleton would be authorized to own 20 percent of the company.
Newspapers’ advertising and subscription revenues have been hurt with the rise of online sites that let people read news and advertise for free online. Singleton said Affiliated Media’s restructuring would give the company “breathing space” to create a new business model for media.
“We who actually work in the newspaper business have a direct interest in keeping newspapers healthy. But we also can see that the communities we serve rely on newspapers, not only to keep everyone informed, and to check government and corporate abuse, but also to provide a cohesiveness that our society very much needs. … Yet many of our citizens now take it for granted, and forget how precious it really is,” Singleton said in a letter to employees.
Earlier this week, Morris Publishing Group, owner of 13 daily newspapers including the Florida Times-Union of Jacksonville, also said it would file a prepackaged plan in federal bankruptcy court.
MediaNews Group owns 54 daily newspapers, more than 100 non-daily newspapers, Web sites, television and radio broadcasters.