Sun-Times Media Group declares bankruptcy

Posted by Leah McBride Mensching on March 31, 2009 at 10:27 AM

Sun-Times Media Group Inc. today filed for Chapter 11 bankruptcy protection in order to "reestablish itself as a self-sustaining, profitable operation. That is worth fighting for, said Chairman Jeremy Halbreich, the Chicago Sun-Times reported.

The news group, which owns the Chicago paper and other suburban dailies and weeklies, filed for bankruptcy "with the aim of reorganising operations, setting a tax liability and making the company fit for a buyer," the Sun-Times article stated. The company owes the U.S. Internal Revenue Service US$608 million in taxes and penalties incurred by former owner Conrad Black, currently in prison for corporate theft. However, the STMG does not have bank debt.

Halbreich told the Sun-Times he aims to keep "as many jobs as possible," while protecting the company's news operations, in both print and online.

The entire STMG company is worth about $4 million, based on its stock, and as of Nov. 7, the company's assets totalled $479 million, and liabilities were at $801 million, according to the bankruptcy documents.

"This action begins a legal and financial process that is designed to protect our Company's brands, stabilize our business and create a brighter future for all of our stakeholders, including our news organizations, advertisers, employees, and you our valued readers," Halbreich stated in a letter to readers.