The McClatchy Co., publisher of newspapers like The Miami Herald, The Sacramento Bee and The News & Observer in Raleigh, N.C., announced last week that it had changed some of the terms of its debt agreements in the hope of staying alive for the foreseeable future.
The amendments to McClatchy’s $1.15 billion existing debt will allow the company to exchange the current debt for cash and new debt. The company’s total debt will also be reduced and McClatchy will have longer to repay it, but it will have to paid back at a higher interest rate.
The news comes a couple months after McClatchy, the country’s third largest newspaper company, announced that it would cut 15 percent of its workforce in March. And that was after the company had laid off 1,400 employees last June.
In an effort to put a happy face on the beleaguered company’s recent announcement, McClatchy CFO Pat Talamantes called the latest move “a positive development.”
“In addition to the outstanding efforts made by our papers to weather this downturn, we believe that being able to have more flexibility in the use of our revolving credit facility will allow us to put the company in a stronger financial position to manage our capital structure through this downturn,” Talamantes said.
It seems that McClatchy has done everything it can to remain afloat and keep its 30 daily papers alive. We certainly hope that it works.
Earlier: The Newspaper Death Spiral Continues
Even Earlier: Media Layoffs: McClatchy Co. Bids Adieu To 1400 Jobs