Friday, December 12, 2008

Dean: We're OK, Hearst owns our debt

Dean Singleton is lashing out at reports (see below) that MediaNews Group is too heavily leveraged and is at risk of default. Singleton told the Rocky Mountain News in Denver that MediaNews is different from most newspaper companies, in that Hearst Corp., which has an interest in some MediaNews papers, "owns the largest piece of our debt." Hearst, of course, is the owner of the Chronicle while MediaNews owns 11 other paid dailies in the Bay Area. Should MediaNews default on its $962 million in debt, Hearst will be the biggest creditor.

According to the Rocky, the Moody's report said the privately held MediaNews has seen a 16 percent decline of total sales during the third quarter and has a "significant weakening in its liquidity profile." It added the company has a senior credit agreement coming due in December 2009 that poses a "refinancing risk."

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