Sunday, June 29, 2008

Analysts: Denver paper in danger of defaulting on debt

For "reasons of space" the full story in the Rocky was only at the finance editor's blog:
The continuing decline of the newspaper industry is putting pressure on the owners of Denver's two daily papers.

Tuesday, E.W. Scripps, the owner of the Rocky Mountain News, will spin off its fastest-growing businesses -- its cable networks and Internet sites -- into a new company called Scripps Networks Interactive. Shorn of those pieces, the stock of Cincinnati-based Scripps -- now a local media company, with newspapers and broadcast stations -- is poised to fall by 90 percent or more.

The final quarter of MediaNews Group, the owner of the Denver Post, ends Monday. Major rating agencies say the company is at risk of defaulting on its debt by the end of 2008. The results for the quarter ending Monday may violate the terms of MediaNews' loans, Standard & Poor's analyst Emile Courtney says.

While MediaNews executives say they expect to stay in their lenders' good graces, Courtney says the company's declining cash flow makes it "increasingly likely that MediaNews will pursue a restructuring of some kind."
My neighbor just quit the Rocky for a new job. He says it's like a morgue around there.

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