The Tribune Company filed for bankruptcy protection in a federal court in Delaware on Monday, as the publisher of newspapers like The Los Angeles Times and The Chicago Tribune struggled to cope with its $13 billion debt and falling ad revenue.
Tribune, which was acquired last year by billionaire real estate investor Samuel Zell, had hired bankruptcy advisers in recent weeks as it negotiated with creditors over debt covenants.
It is only the latest � and biggest � sign of duress for the newspaper industry yet. Several newspaper companies have struggled to cope with declining revenues and mounting debt woes. Tribune has pared back the newsrooms of many of its papers, and it sold off Newsday to Cablevision�s Dolan family earlier this year.
In a court filing, Tribune said it had nearly $13 billion in debt, compared to $7.6 billion in assets. Most of that debt was taken on when Mr. Zell acquired the company � a deal he struck using mostly borrowed money. All of the now privately held company�s equity is owned by an employee stock-ownership plan.
Meanwhile, headlines about signs of trouble screamed across the DrudgeReport's top story today. "NEWS IS BROKE: NYT MORTGAGES HQ IN CASH CRUNCH", read the bright red Drudge headline.
According to the International Herald Tribune, the New York Times Company plans to borrow up to $225 million against its mid-Manhattan headquarters building, to ease a potential cash flow squeeze as the company grapples with tighter credit and shrinking profits.
The company has retained Cushman & Wakefield, the real estate firm, to act as its agent to secure financing, either in the form of a mortgage or a sale-leaseback arrangement, said James Follo, the Times Company's chief financial officer.
Standard & Poor's recently lowered its credit rating on the Times Company below investment grade, and Moody's Investors Service has said it was considering a similar move. Times Company stock, which has lost more than half its value this year, closed on Friday at $7.64, down 30 cents.
(Source: NY Times / International Herald Tribune)
http://www.theyeshivaworld.com/article.php?p=26925
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