The publisher of The Oakland Press announced Wednesday that it has filed for Chapter 11 bankruptcy.
After filing for bankruptcy in the U.S. Bankruptcy Court in the Southern District of New York, the Journal Register Company, headquartered in Yardley, PA, also announced it is looking to sell the company, according to an online press release from Digital First Media, which operates JRC.
“We expect the auction and sale process to take about 90 days, and we are pleased to announce the company has a signed stalking horse bid for Journal Register Company from 21st CMH Acquisition Co., an affiliate of funds managed by Alden Global Capital LLC,” John Paton, chief executive officer of Digital First Media, said.
This will not change day-to-day operation of JRC publications, according to the press release. Locally, that includes its daily publications: The Macomb Daily, The Oakland Press, Morning Sun of Mount Pleasant and Daily Tribune of Royal Oak. JRC also owns numerous weekly publications throughout Michgan under the the names Advisor and Source Newspapers, Heritage Newspapers, Morning Star Publishing Co. and Voice Newspapers, according to MLive.com.
JRC is $160 million in debt, a reduction from being $225 million in the red at the end of 2009, according to a blog Paton published on Digital First Sept. 5. Since then, the company has decreased its operation costs by 10 percent, according to the press release. Between then and 2011, revenue grew by 235 percent and the JRC's online audience about doubled, he wrote, however, expenses from its investment in digital media also increased by 155 percent as the company focused on heightening its online presence.
However, Paton attributed the company's financial struggle to industry-wide declines in print advertising despite its growth digitally. Print advertising, which accounts for about half of the company's revenue, decreased by 19 percent between 2009 and 2011, Paton wrote.
"Since 2009 the company’s pension liabilities grew 52 percent," he said in the press release. "After much consideration, the Board of Directors concluded a Chapter 11 filing was the best course of action for Journal Register Company. As difficult as they are, the steps we announced today are steps that will ensure the company’s future.”