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US paper firm files Chapter 11 protection
By Emily Chasan |
February 23, 2009, Monday
|
Print Edition
Print Edition
JOURNAL Register Co sought Chapter 11 bankruptcy protection on Saturday, making it the latest United States newspaper company to buckle under deteriorating advertising revenue and debt that it cannot easily repay.
The company publishes 20 daily newspapers, including The New Haven Register and The Trentonian. It joins the ranks of the Minneapolis Star-Tribune, as well as Tribune Co, publisher of the Chicago Tribune and Los Angeles Times, and highlights the challenges US newspapers face as advertisers flee their print editions and more people get their news for free online.
For years, Journal Register has been among the smallest of publicly traded US newspaper publishers. Nevertheless, its filing will increase scrutiny on other US newspaper publishers, including McClatchy Co and Lee Enterprises, which are trying to survive a severe ad downturn without running afoul of their creditors.
Journal Register has already agreed with key creditors on a pre-negotiated reorganization plan, and said it was planning to restructure its operations.
A pre-negotiated bankruptcy allows companies to move more quickly through the court process because they have agreed on major issues with groups of creditors. The company plans to solicit votes quickly from other creditors on its bankruptcy reorganization plan, according to court papers.
The Pennsylvania-based company said advertising revenue had been driven lower by the housing downturn, declining automotive sales, the retail sector slowdown, among other factors.
The company publishes 20 daily newspapers, including The New Haven Register and The Trentonian. It joins the ranks of the Minneapolis Star-Tribune, as well as Tribune Co, publisher of the Chicago Tribune and Los Angeles Times, and highlights the challenges US newspapers face as advertisers flee their print editions and more people get their news for free online.
For years, Journal Register has been among the smallest of publicly traded US newspaper publishers. Nevertheless, its filing will increase scrutiny on other US newspaper publishers, including McClatchy Co and Lee Enterprises, which are trying to survive a severe ad downturn without running afoul of their creditors.
Journal Register has already agreed with key creditors on a pre-negotiated reorganization plan, and said it was planning to restructure its operations.
A pre-negotiated bankruptcy allows companies to move more quickly through the court process because they have agreed on major issues with groups of creditors. The company plans to solicit votes quickly from other creditors on its bankruptcy reorganization plan, according to court papers.
The Pennsylvania-based company said advertising revenue had been driven lower by the housing downturn, declining automotive sales, the retail sector slowdown, among other factors.
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