MediaNews Group, which publishes nine newspapers in Southern California and dozens of others across the country, announced today that it will file for Chapter 11 bankruptcy.MediaNews chairman Dean Singleton said in a statement that the company has reached a deal with its lenders for a streamlined reorganization process that should take about 60 days to complete. The plan will reduce the company's debt by $765 million, cutting it to $165 million.
Singleton assured employees that the bankruptcy would not affect jobs or benefits and said that none of the company's papers will be sold or shuttered. Since the bankruptcy will be handled through a separate holding company (called Affiliated Media), Singleton said the papers would experience business as usual.
From Singleton's statement:
In our search for a new model that reflects the realities of today’s changing newspaper environment, we have come up with a solution that restores financial strength and flexibility to our balance sheet. It does not affect the operations of any of our newspapers or vendors or other operations. It gives us one of the strongest balance sheets in the industry. It gives us breathing space to create a new model for the newspapers we publish.Here's some more detail from the Wall Street Journal:
MediaNews is the third newspaper company in Southern California to file for bankruptcy. Tribune Co., owner of the Los Angeles Times, filed for Chapter 11 in December 2008. Freedom Communications, which owns the Orange County Register, went bankrupt in September.Under MediaNews' plan, senior lenders will swap debt for equity, helping reduce the company's debt load from about $930 million to $165 million. Bondholders will get warrants for possible future equity. People familiar with the transaction said the company has been valued at roughly $200 million, including about $50 million of equity value.
Hearst Corp., the owner of magazines and newspapers, has at least $400 million in equity and debt tied to MediaNews, and the investment will be wiped out by the bankruptcy filing, according to people familiar with the matter. A Hearst spokesman declined to comment.
"We have worked side-by-side with Hearst on this," Mr. Singleton said.
-snip-
Mr. Singleton's ability to retain control over MediaNews represents a face-saving victory in the company's restructuring, and on Friday Mr. Singleton said he wanted to try to be the aggressor in merging newspapers.
Bankruptcies often result in board and management changes. Mr. Singleton, like many corporate executives, was sensitive to any negative fallout from a bankruptcy filing, according to people close to him.
MediaNews owns the Los Angeles Newspaper Group, which publishes the Los Angeles Daily News, Pasadena Star-News, Daily Breeze, San Bernardino Sun and five others, and the Bay Area News Group in Northern California.
(This post was updated with the WSJ story link.)
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47 comments:
Just had to buy all those bay area papers didn't ya?
here's the real part to be concerned about for LANG et al
Asked which newspapers or groups of newspapers might be combined, Mr. Singleton answered: "You can look at the map."
how do you eliminate $750 million worth of debt by swapping it for equity in a company only worth $200 million in total?
The guy is amazing
It had to come. I suppose now the flagship of the group will be the San Bernardino Inland Valley Tribune, with Steve Lambert and Frank Pine at the helm.
Why the hell are they referring to Singleton as Mr and not a more appropriate title?
remember when he and his suits INSISTED that he would NEVER EVER file? hmmmmm......don't believe a word.
this was clear as a crystal to all the workers at LANG. It was inevitable. yet he BRAINWASHED everyone into thinking it would never happen. don't you guys recall? so the moral of the story is DO NOT believe a word. you WILL see papers shuttered and more jobs lost. do the math folks. RUN. GET OUT!!!
now is it that lean mean dean manages to put a positive spin on everything? unbelieveable. there's an old adage here: actions speak louder than words!!
YAWN
hey guys! who wants to take bets on how many papers he will shut down. you KNOW it will happen. so LANG will be ONE big newspaper. which one's will shutter?
that's right 8:40. and that is what got him into this mess. and the little folks had to pay by getting laid off and decimating their papers to nothing. they will never prosper or bounce back. have lost most readers as it is.
The owner and his team of ass clowns are dolts. As one poster said earlier, who would want the newspapers. That has been clear all along. The lenders had no choice. At least this way they have a chance to recoup some dollars.
As far as Medianews mantra of no layoffs, no closures, get serious. I can hear old Janniga now spewing that crap all over again. Great investment Hearst. You get in bed with Singleton, it shouldn't be a surprise when he can't perform. You deserve it.
The bottom line is that once again, more hard working people will get screwed by the fools who have no clue on how to generate revenue or manage people.
equity in this death group must be a great investment. and, business as usual must make the rank and file feel very good abouth their future. why don't you get someone that knows revenue from bullshit and try to help yourself?
the flagship will continue to be sgvn...hasn't lambert done wonders since his rise to the top? how does revenue look now vs when he got the job?
ok, forget revenue, how about circulation and quality coverage. ok, forget that, how about customer service and work enviornment. ok, forget that, how about?????
As a former MediaNews employee, one word came to mind as I read this?
LIES!
LIES! LIES! LIES!
What's the word of a man who has lied over and over and over and over worth to anyone?!!!!
SINGLETON, YOU WORTHLESS ...
I'm very sorry for this tirade Gary but it's been building up for son long. All my friends ... my coworkers. This was our life's work. We may not have been the LA Times but most of us were proud of our work.
And now?
Journalism's savior my ass! This industry was already in trouble long before he started to snap up newspapers. Instead of having a solid plan he used the old routine of "Let's merge and cut staff."
We were his toy! We were a personal game of "Monopoly." He snapped up all the little Baltic Avenues because, all together, we were going to turn you a nice profit. He never had a solid business plan so when the 'Great Recession' hit he was so deep in the hole, all he had left was to cut.
And cut he did. Simpleton!
YOU ... YOU!!! How I would love to insert a string of obscenities right fricken here. YOU STUPID KNUCKLE DRAGGIN MOUTH BREATHER! WORTHLESS DOPE!
All of those people! All of that talent you had ... in your offices! YOU NEVER INVESTED IN EVEN THE BASIC TECHNOLOGY THAT MIGHT HAVE GIVEN YOUR PAPERS A FIGHTING CHANCE.
The LA Daily News folks struggled routinely with their Internet system. They struggled to post blogs. When papers were merged, instead of improving the technology of all the papers, you forced the papers on the better computers systems to "take a technological step back" because the older system was either less expensive or paid for.
You never invested in training of your staff. From what I've heard, you never afforded your newspapers a proper budget for their Online media departments.
You son-of-a ... HOW FORTUNATE FOR YOU THAT YOU RETAINED YOUR POWER, YOUR BIRTH RIGHT? Isn't that what it is? You savvy "veteran" journalist! You savior of all things media.
You expect us now to believe that none of the papers will be shuttered? Tell me what the hell the difference is between merging and shuttering to an employee forced to travel long distances to a different office to work?
This bankruptcy is the best and worst thing that could ever happen. The picture you paint of "Nothing to see here. All is great. It's business as usual" is a lie.
People will get hurt. I hope to God the only people hurt are you and your other inept business-suited minions (LAMBERT!) and not the ever dwindling number employees who struggle daily to put our your products.
Wow 2:12...not leaving any doubt on what side of the fence you sit.
And, you are right. He ruined decent papers and will continue to do so. Along the way he caused misery and heartache for an untold number of employees who were doing a good job.
Invest. The only investment he made was to gather his top employees together so they could tell him how brilliant he is.
The sad part in all of this is that he won't get hurt financially like he is causing others to be.
This organization is inept.
yay for 2:12. nothing i will say can top that. you are spot dead on. good for you!!! i'd love to shake your hand. :-)
Anybody who thinks this won't impact their gig at some point, really needs to wake up.
If you have been at theis chain for some length of time and you haven't woken up yet, you won't.
in a more balanced article singleton waxes poetic on how precious newspapers are...the only thing precious to him is how much money he can suck up...oeriod.
wonder why hearst is giving up their stake?
8:30 -- Maybe Hearst is cutting its losses. Remember that everything Dino touches turns to crap.
of course there will be layoffs, shuttering of papers, downsizing more etc. the lenders are not going to just let him off the hook. this is what restructuring is all about. duh. put your thinking caps on. and check out ronkayela.com. he has a good piece.
It's just like when you file BK against a car when you are up for repossession ... it just gives you more time to HIDE the car.
Bob Slydell: Would you bear with me for just a second, please?
Peter Gibbons: OK.
Bob Slydell: What if - and believe me this is a hypothetical - but what if you were offered some kind of a stock option equity sharing program. Would that do anything for you?
Peter Gibbons: I don't know, I guess. Listen, I'm gonna go. It's been really nice talking to both of you guys.
Bob Slydell: Absolutely, the pleasure's all on this side of the table, trust me.
Peter Gibbons: Good luck with your layoffs, all right? I hope your firings go really well.
Bob Porter: Excellent.
Bob Slydell: Great... Wow.
exactly. the thing that just galls me is that singleton spews such lies. and thinks people are stupid. "remember when" he claimed all was well and don't believe the rumors about bankruptcy? well....?
and now he is putting another BS spin on this by saying business as usual. how can it be business as usual? impossible. you guys, he doesn't want you to all leave until he is ready to throw you off the ship or until it has totally sunk. so who will be the last rat off?
Singleton just got a $550 million dollar pay day. He'll be just fine. And you all can whine as loud as you want. He doesn't care. He'll walk away with a personal fortune. Because he has the balls to do it, and you don't.
I have no problems with singleton and his balls. He can do what he wants to do as long as it is legal. My problem as stated by others is that he lies, over and over aggain. The innocent people in all this are the employees who can't find other avenues to earn a living, the vendors who will be short changed by his lack of honesty, and, his customers who will be receiving even less of a product. If his goal is laughing his way to the back congratulations, he won. If his goal was to truly save newspapers and put out quality products he lost.
So now Singleton says his bankruptcy will give him one of the strongest balance sheets in the industry...what a crock of crap. I guess he has sources that allow him to look at all the balance sheets of the industry including other private firms. He can't tell the truth.
I remember in 1999, Steve O'Sullivan, with his "kill them all and let God sort 'em out" marching orders from LANG, walked into the Daily Bulletin newsroom and chided the publisher and top editors for folding the Pomona Progress-Bulletin a few years before into the Ontario Daily Report to become the Inland Valley Daily Bulletin.
"You screwed up. You did it wrong," he said. "We will show you the right way."
At that time the Inland Valley Daily Bulletin was owned by Stephens Media and was earning tons of cash. But Stephens sold the Bulletin to Singleton for two reasons: It saw the handwriting on the wall, recognizing before many other local news organizations that regional papers couldn't compete against the larger papers for national advertising. Stephens also saw that Southern California daily newspaper readership was starting to significantly decline.
O'Sullivan and LANG thought that readers wouldn't care that the Sun's San Bernardino stories appeared in the Bulletin and Ontario stories were published in the Sun. It was all local as far as LANG was concerned. But Ontario readers didn't give a damn about San Bernardino and dropped the paper. The "cluster" concept failed from the get-go. Layoffs, no investment in technology, and managers valued less for vision and more for knowing how to do more with less didn't prevent the inevitable. It took about 10 years for Singleton to reach this point, but I can assure you that LANG et al have been struggling financially with a losing cause since 1999. Stephens played it smart and bolted. They diversified into other publishing fields, and along with their Las Vegas paper are doing just fine.
Singleton paid little attention to the Inland Empire newspaper market or understand what the Bulletin meant to Ontario area readers. Now he is left holding the bag.
Singleton said his company is making real progress on an outdated business model. OK, I give up. Where?
As my old pappy use to say, when the cattle are dropping cowpies, it's probably a mistake to think it's a donut.
And as Singleton told the Wall Street Journal in an interview relating to the current bankruptcy process, he continues to press his vision for consolidation of the newspaper industry, telling the Journal he wanted to be the “aggressor” in that effort. The group’s employees fear that by consolidation, Singleton means more outsourcing or more centralization of operations regionally and nationally. There’s been a lot of that already, and there could be more, but Singleton and Lodovic will now be free to expand their partnerships, to seek mergers with other groups, or to rationalize the market through exchanges of newspaper properties. “Look at the map,” Singleton told the Journal in response to the question of where such consolidations might occur.
does this sound like biz as usual? gimme a break. i just feel for the poor souls left at LANG.
8:56, you're probably someone I know, but I was in that newsroom in 1999 too and it wasn't O'Sullivan who said those things.
It was Singleton himself, who came into our newsroom right after the purchase and said the biggest mistake Don-Rey had made was merging Ontario and Pomona.
"I don't believe in merging newspapers," Singleton told us.
Of course, as it turned out, there are merges and there are merges. What Singleton believed was putting out the same paper (basically) with two different mastheads.
When Singleton bought the Daily Bulletin, we had 99 newsroom employees and 72,000 circulation.
I wonder if they even have 35 newsroom employees anymore.
I also was in the Daily Bulletin newsroom in 1999. I believe I told my colleagues, and I'll paraphrase: "This is the beginning of the end." I knew it was true because I was part of the SGVN newsroom when Singleton scooped up that property. The Singleton/O'Sullivan Experience is not something any human should be exposed to twice in one lifetime.
osullivan can't carry singletons jockstrap when it comes to screwing people.
Now I am reading that the guild is going to make sure singleton stands by his word...well that should make all the members feel good. They have done such a wonderful job for their members the last few years.
A response to those who are warning current LANG employees to wise up, wake up and get out ... I know of very few LANG/MediaNews employees who work for that company willingly. Nearly everyone works there out of necessity. When there are job openings, they are competing with hundreds of cheap young college grads and 30-year vets who are being pushed of the biz. In fact, if any of those posting comments here know of a job that any of these folks can apply for, you might want to post that here ASAP.
Can't argue with 11:40. No one in their right mind would work for this group. Crappy leadership, no direction, no plans that make any sense, and the always threat of worse times to come.
"Now I am reading that the guild is going to make sure singleton stands by his word...well that should make all the members feel good. They have done such a wonderful job for their members the last few years."
I guess that means you support giving unions more power? Thanks for standing with us.
Or were you blaming the unions for being weakened by the same corporate powers that are screwing over employees?
Yeah, it's our fault that congress and the chamber of commerce decided to abandon the middle class. I said "our" because every member IS the union. If you work in a union newsroom, you have just as much power as any of us. I suppose that annoys bootlickers and suckups.
Now now folks. Let's not fight among ourselves. Every time an employee breaks, a big wig gets a yacht
Hey baby, when you are toothless let's not pretend you are JAWS.
Who ever said anything about the "big bad union" tough guys?
Saying they're going to make sure the process follows the law is exactly within the realm of their power. If you disagree, you should go ask the company how much they've spent on lawyers for court cases they end up losing in the last five years.
But I don't expect you to bother. It's more fun to point fingers and let the bosses teabag you. I hope all that ass kissing gets you somewhere. If it's productive, I won't begrudge you any animosity. But if they end up shafting you anyways, understand we're all going to laugh at you. Again.
the biggest lesson here for any still at LANG is don't believe a word singleton says. remember when he INSISTED the rumors about bankruptcy were just that? well....? and funny how he released this news on a holiday weekend at 5 p.m. talk about burying the lede. what is going to happen is lean dean is putting another one of his spins on things until he's ready to close shop or dump folks. he wants to be the one to tell folks when they can leave, not the other way around.
No one is crapping on the union. Just making a point that it hasn't worked out well for union and non union employees, has it? For craps sake, there isn't any printing done any longer except east of Los Angeles. The company, and I have no love or income from them, might have spent gads of money on lawyers, but, it has not helped the rank and file. Please don't tell me it would be worse without the union. You can have your point of view and I can have mine, I happen to believe they don't do much.
A plea to Mr Singleton. Take your money and your management team and find another industry to kill quicker. Your employees are tired of you, your bankers are tired of you, and anyone who cares about the industry is tired of you. Enjoy your chardonay and relax on your ranch. Please.
Dean's a bottom feeder who must create a new bottom to feed him. He says it's a new model. Pine's an insurance salesman. Lambert's a stockboy.
Think about them only when you have a nice bowel movement, and after a couple of them, no more.
I use to enjoy a good BM!
Good GOD man, why is his clown allowed to manage anything? What a joke.
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