Dec 7, 2008

Bankruptcy fears for Tribune Co.*,**

Is Tribune Co. trying to stave off bankruptcy proceedings or seeking bankruptcy protection? The New York Times follows an earlier post that implied the former with a fuller story that indicates the latter might actually be the case:
The Tribune Company, the newspaper chain that owns The Chicago Tribune and The Los Angeles Times, is trying to negotiate new terms with its creditors and has hired advisers for a possible bankruptcy filing, according to people briefed on the matter.

Tribune is in danger of falling below the cash flow required under its bonds, but it is not clear how seriously Tribune is thinking about seeking bankruptcy protection. Analysts and bankruptcy experts say that the hiring of advisers, including Lazard and Sidley Austin, one of the company’s longtime law firms, could be a just-in-case move, or a bargaining tactic. The company would not comment on Sunday.
*UPDATE: The Wall Street Journal reports that a bankruptcy filing could be imminent:
Tribune Co. is preparing for a possible filing for bankruptcy-court protection as soon as this week, according to people familiar with the matter, in a sign of worsening trouble for the newspaper industry.
**UPDATE: The Los Angeles Times follows with a own story of its own:
The company ... is preparing for a possible bankruptcy filing as it attempts to renegotiate $12 billion in debt obligations with banks and other creditors, a Tribune Co. official said Sunday.

The Chicago media conglomerate hired Lazard Ltd. a little more than a week ago for advice on a possible Chapter 11 filing, though people familiar with internal talks said the company was exploring several options.

"Revenue declines have been dramatically worse, even over the last couple of weeks. It's just really rough," said the Tribune executive, who declined to be named because he was not authorized to speak publicly about the company. "A number of advertisers just don't have the money to spend right now.

"Some advertisers are still pushing to get through the holiday season, but when others look to cut discretionary spending, we are right at the top of the list," the executive said.


Anonymous said...

It appears the rantings of a newspaper redesign won't take a newspaper to the promised land. What a scoop. All that hoopla is window dressing for a newspaper. Redesign, faster format, redesign classified, etc., only takes the focus away from the important issue, selling. That is the art that has been lost and has come home to roost for Tribune. The cast of characters the last decade who have been responsible for revenue growth in Los Angeles make the executives at the big three auto makers look highly skilled.

Anonymous said...

I guess all the funny quips, press releases and road shows from the Zell brain trust hasn't worked very well.

Maybe you could go after younger readers, do another redesign, and continue to discuss innovations that newspapers must do to survive.

Hell, my guess is that there are former leaders at your newspapers who would work for the same dollar a year as Sam for a piece of revenue growth.

Now that is innovation.

Anonymous said...

There's still hope. Oxnard Street is still vacant and has the necessary wiring for a modest newspaper operation. And the Times could share space with the LA Daily News, wherever it is today, because there is likely to be ample space for both staffs. Think out of the box. Share, consolidate, seek new partnerships.