Owner of Dearborn Paper Files For Bankruptcy
Sunday, February 22nd, 2009The Journal Register Co., owner of the Dearborn Press & Guide, and more than a dozen other papers in Michigan, including the Oakland Press and the Macomb Daily, filed Saturday for bankruptcy protection from its creditors — the third newspaper publisher to do so since December.
While the company blamed a slump in advertising for its financial woes, the Dearborn Press & Guide, part of the Heritage paper chain, appeared to be in slightly better shape in terms of overall advertising.
The Journal Register said it would cancel its stock, which has been trading as a penny stock now for sometime, and become a closely held company, owned by its lenders, under a proposed reorganization plan filed in U.S. Bankruptcy Court in New York.
The Journal Register listed debt of as much as $1 billion and assets of between $100 million and $500 million in Chapter 11 documents.
The bankruptcy filing is not expected to impact the Dearborn Press & Guide delivery, at least not in the foreseeable future. The paper recently closed its Dearborn offices and moved to Heritage headquarters in Southgate as part of a cost cutting effort.
The Journal Register follows the Tribune Co., owner of the Los Angles Times and Chicago Tribune newspapers, and the Minneapolis Star Tribune into bankruptcy.
Newspapers around the country are struggling because of slumping advertising sales and subscriptions, accelerated in part in trying to compete with online search engines, where these very newspapers give away their stories for free. Newspapers have been unable so far to find a way to make money on the Internet.
“With the increased competition from other forms of media and slumping advertising revenues, the downward pressure on newspaper earnings will likely remain intense in the near term,” James Hall, Journal Register CEO, in court papers.





