Post by fired have more time to blog on Nov 17, 2011 16:20:52 GMT -5
The vultures circle: Several news outlets reported last week that HM Capital of Dallas, Texas, a major financier of Richard Connor’s 2009 purchase of what is now MaineToday Media, will no longer invest in newspapers because of poor returns. HM Capital also put up much of the $65 million Connor used in 2006 to buy the Times Leader in Wilkes-Barre, Pa. An HM official refused to comment when asked by a reporter at the Citizens’ Voice of Wilkes-Barre what that decision meant for the future of the newspapers.
The Voice article cited an industry expert’s assessment that the loans for both media companies are “probably underwater.”
Given the state of the industry, it doesn’t seem unlikely that Connor’s Pennsylvania papers are worth less than he owes on them. But his Maine publications – the Portland Press Herald, Kennebec Journal and Morning Sentinel – were purchased at bargain-basement prices, with published estimates ranging from $28 million to as little as $10 million. Given that Connor, before his abrupt ouster in October, had slashed staffing and other expenses, and sold off real estate to pay down debt, it’s likely there’s some equity left in the Maine company.
And if the rumor mill is to be believed, some interest in purchasing the papers. Among the unverified reports:
Richard Warren, owner of the Bangor Daily News, has made an inquiry about buying his rivals. If true, such a move would give Warren a near monopoly in the state’s print media.
Unless another bit of gossip has some validity. The Costello family, which owns the Lewiston Sun Journal, came close to entering the Portland market in 2009, when it looked as if the Press Herald, then owned by the Blethen family of Seattle, might go bankrupt. That plan called for the Costellos to upgrade their weekly Forecaster newspapers to daily status. To stave off being surrounded by competitors owned by the Bangor Daily, that idea is said to have been revived and in the process of being updated.
The Voice article cited an industry expert’s assessment that the loans for both media companies are “probably underwater.”
Given the state of the industry, it doesn’t seem unlikely that Connor’s Pennsylvania papers are worth less than he owes on them. But his Maine publications – the Portland Press Herald, Kennebec Journal and Morning Sentinel – were purchased at bargain-basement prices, with published estimates ranging from $28 million to as little as $10 million. Given that Connor, before his abrupt ouster in October, had slashed staffing and other expenses, and sold off real estate to pay down debt, it’s likely there’s some equity left in the Maine company.
And if the rumor mill is to be believed, some interest in purchasing the papers. Among the unverified reports:
Richard Warren, owner of the Bangor Daily News, has made an inquiry about buying his rivals. If true, such a move would give Warren a near monopoly in the state’s print media.
Unless another bit of gossip has some validity. The Costello family, which owns the Lewiston Sun Journal, came close to entering the Portland market in 2009, when it looked as if the Press Herald, then owned by the Blethen family of Seattle, might go bankrupt. That plan called for the Costellos to upgrade their weekly Forecaster newspapers to daily status. To stave off being surrounded by competitors owned by the Bangor Daily, that idea is said to have been revived and in the process of being updated.