Philadelphia Newspapers Inc. files for bankruptcy
Posted by Simon Day on February 23, 2009 at 4:54 PM
Philadelphia Newspapers Inc., parent company of The Philadelphia Inquirer and The Philadelphia Daily News, filed for bankruptcy protection on Sunday in order to restructure US$390 million debt, the Inquirer reported Monday.
The move marks a dramatic attempt to further counter declines in advertising revenue and circulation. The Philadelphia Inquirer had a reported weekday circulation decline of 11 percent and Sunday decline of 14 percent in 2008.
The move marks a dramatic attempt to further counter declines in advertising revenue and circulation. The Philadelphia Inquirer had a reported weekday circulation decline of 11 percent and Sunday decline of 14 percent in 2008.
Philadelphia Newspapers' debt stands at $390 million, according to the Inquirer. The company chose to pursue bankruptcy proceedings after 11 months of negotiation with its lenders, during which it incurred $13.4 million in penalty interest and fees.
The company stressed the continued operation of its publications and online business during the debt restructuring. Chief Executive Officer Brian P. Tierney said the "restructuring is focused solely on our debt, not our operations. Our operations are sound and profitable," the Inquirer reported.
The two newspapers were bought in June 2006 by a group of Philadelphia investors lead by Tierney.
The Philadelphia Newspaper Inc. application for bankruptcy protection is the second over the weekend, following the Journal Register Co. filing for protection on Saturday, and the fourth within two months, as with the Chicago-based Tribune Co. and The Star Tribune of Minneapolis seeking Chapter 11 restructuring in December and January, respectively.
The company stressed the continued operation of its publications and online business during the debt restructuring. Chief Executive Officer Brian P. Tierney said the "restructuring is focused solely on our debt, not our operations. Our operations are sound and profitable," the Inquirer reported.
The two newspapers were bought in June 2006 by a group of Philadelphia investors lead by Tierney.
The Philadelphia Newspaper Inc. application for bankruptcy protection is the second over the weekend, following the Journal Register Co. filing for protection on Saturday, and the fourth within two months, as with the Chicago-based Tribune Co. and The Star Tribune of Minneapolis seeking Chapter 11 restructuring in December and January, respectively.
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