Via Editor and Publisher…with a pointer from Hart Van Denburg.
Less than two years after it was bought by a private equity group, the Star Tribune has filed for reorganization under Chapter 11 bankruptcy.
But wait, there’s more…
In December, Harte told employees the “survival of the company” was at stake and asked labor unions to agree to $20 million in cuts by mid-January. Without those cuts, Harte said the newspaper could face bankruptcy.
The Star Tribune ranked as the nation’s 15th-largest paper last October, with weekday circulation of about 322,000 and Sunday circulation of almost 521,000. The paper has nearly 1,400 employees.
Here is why this is important news: less than a decade ago, we looked on The Star Tribune as one of the few papers, (the Atlanta Journal-Constitution was another) that seemed to really “Get” the internet. A real model for how a paper would move forward.
The problem is that even if you start moving in the right direction, if the financial folks aren’t, you’re sunk. And obviously, like the Tribune Co., The Star Tribune managed to saddle themselves with massive debt at exactly the wrong time.
We knew things were getting bad for newspapers, but the economic problems of the country are particularly harsh on the most overleveraged. I suspect we will see much more of this in the coming months. Perhaps it’s time to start up the Newspaper Dead Pool.
For those at the ST, I hope you manage to power through. I’ve always been a fan of your work, and look forward to more in the future.