Wednesday, April 22, 2009

Falling ad revenue and heavy debt sink local buyers' efforts

Private owners, particularly those like Tierney with local roots, were once welcomed as saviors in many newsrooms. Independent ownership, the theory went, would not be bound by Wall Street's appetite for profits and, therefore, could save newspapers from devastating cuts. It's a theory that some Bostonians have resurrected today, given The New York Times Co. threat to shutter The Boston Globe if unions don't agree to $20 million in concessions. Some believe the cuts may be a prelude to a sale and are hoping a local buyer steps up.

But recent buyers of newspapers have struggled to stay in business, much less stay in the black. The Tribune Co., publisher of the Chicago Tribune and Los Angeles Times, among other papers, filed for bankruptcy last December, less than two years after real estate mogul Sam Zell acquired it in an $8.2 billion deal. Star Tribune Holdings Corp., which bought the Minneapolis Star Tribune for $530 million in 2007, declared bankruptcy a month after the Tribune Co. did. Then came Tierney's bankruptcy filing in February.

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