McClatchy, America's second-largest newspaper company, files for bankruptcy

McClatchy Newspapers File for Chapter 11 Bankruptcy Protection 3,313Wilfredo Lee File  AP

McClatchy Newspapers File for Chapter 11 Bankruptcy Protection 3,313Wilfredo Lee File AP

Forman said McClatchy doesn't anticipate any adverse impact on qualified pension benefits for substantially all of the plan's participants and beneficiaries.

According to the media analyst Ken Doctor, Chatham's imminent acquisition of McClatchy represents, if nothing else, a period of "momentary stability" for the newspaper company, which will now be operating with "a much cleaner balance sheet".

The McClatchy Company, the publisher of newspapers from the Miami Herald to the Kansas City Star, is filing for Chapter 11 bankruptcy protection. McClatchy's pension plan is underfunded by about $535 million.

On Thursday, as news broke about the McClatchy's bankruptcy, our reporters were covering the funeral of a slain Florida Highway Patrol trooper, a proposal by State College of Florida that promises to bring big changes to Parrish and a story about why this weekend's Cortez Fishing Festival is such an important event.

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 greatest crisis in American journalism is the death of local news", Baquet said at the International News Media Association World Congress at the time.

McClatchy's spokeswoman said the company had no comment.

Dan Kennedy, a journalism professor at Northeastern University who follows the sector, said McClatchy's woes follow "the narrative that we've seen with corporate chain ownership" by accumulating debt that kept it from investing in future technologies.

Though financial results aren't yet final, the company estimates that 2019 revenue fell 12.1% from the previous year, its sixth consecutive annual decline. "We are moving with speed and focus to benefit all our stakeholders and our communities", CEO Craig Forman told the Associated Press today.

In a statement, Chatham said it was "committed to preserving independent journalism and newsroom jobs". Chatham said it has been "a supportive investor" in McClatchy since 2009.

The publisher's origins date to 1857 when it first began publishing a four-page paper in Sacramento, California, following the California Gold Rush.

McClatchy publishes 30 newspapers in 14 states, including five in California: The Tribune, The Sacramento Bee, The Fresno Bee, The Modesto Bee and Merced Sun-Star.

Last year, New York Times Executive Editor Dean Baquet made a dire prediction that a number of local newspapers will die in the "next five years". McClatchy is still based in Sacramento.

The bankruptcy filing will not immediately impact the 30 newsrooms now operating under the McClatchy umbrella, and the company said it secured $50 million in financing to continue operations.

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