"Publicly available information regarding the 2018 Transaction raises serious concerns about whether fraudulent transfers may have occurred, or whether CAM's (Chatham's) claims should be partially or completely subordinated", said the filing from Joseph K. Grekin, a lawyer with Schafer and Weiner, which is serving as outside counsel for the PBGC. That would mean the publisher's revenue will have slid for six consecutive years.
Newspaper companies have been through a string of Chapter 11 reorganizations in recent years.
What they're saying:"While we tried hard to avoid this step, there's no question that the scale of our 75-year-old pension plan - with 10 pensioners for every single active employee - is a reflection of another economic era", Kevin McClatchy, the company's chairman, said in a statement. For full-year 2019, revenues are expected to be $709.5 million, down 12-percent from 2018 with advertising revenues of $337.1 million and audience revenues of $321.8 million.
Digital-only subscriptions have increased by nearly 50% year over year, McClatchy said.
"It's not because of how they cover or don't cover national news, it's not because of what the president says about them, it's because Google and Facebook and Craigslist have taken all their advertising away", he said. Pew said that was down 13% from 2017 and that total estimated circulation revenue was $11 billion, compared with $11.2 billion in 2017.
McClatchy has struggled to pay money owed to its pension fund and has been in negotiations with the Pension Benefit Guaranty Corporation, a federal guarantor of pensions, to assume control.
What's next: If the court accepts the bankruptcy plan, the group of new owners would likely be led by hedge fund Chatham Asset Management, McClatchy's largest creditor.
The so-called "managed bankruptcy", Franklin said, gives McClatchy a chance to keep the lights on and significantly reduce its debt load brought on by pension payments promised in the days of yore, as newspapers are left competing for digital ad dollars primarily soaked up by social and search. Chatham Asset will be the new majority owner. Alden owns the nation's second-largest newspaper chain, Digital First Media, and has overseen drastic cost-cutting at 100 daily newspapers, eliminating more than 1,000 jobs. American Media is in the process of selling the Enquirer. "We are moving with speed and focus to benefit all our stakeholders and our communities", CEO Craig Forman told the Associated Press today.
Last year, New York Times executive editor Dean Baquet bleakly predicted the demise of "most local newspapers in America" within five years, except for ones bought by billionaires. Amazon founder Jeff Bezos owns The Washington Post and has invested in its newsroom.
Even the arrival of moneyed interests can prove fleeting.
In an ominous sign for the print newspaper industry, Warren Buffet's Berkshire Hathaway recently unloaded its 31 newspapers to Lee Enterprises for $130 million.
The company began with a small newspaper based in Sacramento, California, amid the Gold Rush. That publication later became the Sacramento Bee.
Its 30 newsrooms, including The News-Tribune in Tacoma, The Olympian in Olympia, The Bellingham Herald and the Tri-City Herald in Kennewick, will continue to operate as usual.