From the Mercury News: The rating outlook is negative for the closely held Denver-based company, New York-based S&P said Thursday in a statement. CCC is four levels above default.
Business partners may not continue to support MediaNews if the newspaper market continues to deteriorate, S&P said. The company, controlled by William Dean Singleton, will be forced to restructure in the "intermediate term" at its current rate of cash-flow declines, S&P said. MediaNews is the second-largest closely held U.S. newspaper publisher after Tribune Co.
None of this is good news, of course, for the reporters and editors still working for the Singleton chain. Unless Hearst or some other company decides to ride to the rescue with an infusion of cash, or online ads start generating unheard of revenues, or Singleton decides to sell off a few properties, MediaNews will likely resort to further cost cuts to raise the cash needed to pay down its debt.
The Rocky Mountain News carried a response to the downgrading from MediaNews President Joseph "Jody" Lodovic: "We are in compliance with all our debt agreements and expect to stay in compliance in the future."
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