METRO SPIRIT
Issue #21.28 :: 02/03/2010 - 02/09/2010
Paul Simon to the rescue
BY THE INSIDER
AUGUSTA, GA – Come on, Billy. Are things really that bad?
It is pretty sad when you have the former president of Morris Communications Corp. defending you in a column in your own newspaper.
“It distresses me to learn that my friend Billy Morris has had to put his newspaper companies into bankruptcy,” Paul Simon, former president of Morris Communications Corp., wrote in a guest column this past weekend for The Augusta Chronicle. “Because of the economy and changes that have occurred in the media industry, a number of other newspaper companies throughout the country have been forced to take the same step.”
Simon wrote that the Morris bankruptcy filing will allow the company an “opportunity to pay all of its other creditors in full, settle with the bond holders and restructure the company for the future.”
Morris’ sidekick went on to detail the numerous projects and charities the Morris family have contributed to over the years.
The reason Simon said he felt compelled to write this column was “in response to a number of recent local newspaper articles and other criticisms of Billy Morris.”
Ever since Morris Publishing Group announced it was seeking bankruptcy last month, the local news coverage has been extremely respectful of Morris’ employees.
The truth of the matter is, the parent company of The Augusta Chronicle was not able to receive the necessary support from the holders of 99 percent of its debt for its proposed “exchange plan” presented late last year. Therefore, the company was forced to file a Chapter 11 bankruptcy plan last month.
Morris Publishing received court approval on Jan. 19 to continue its business operations without interruption as thecompany seeks bankruptcy.
“We are gratified that the court approved these critical motions,ensuring that our customers, employees and suppliers will see no change in our business operations,” William S. Morris III, chairman of Morris Publishing, stated in a press release. “This allows us to complete the final step in our debt restructuring without any noticeable impact to our newspapers. Just as important it saves thousands of jobs and enables us to continue to operate ourbusiness with the same high standards we have for three generations.”
The court also set a deadline of Feb. 10 for objections to the plan and disclosure statement submitted by Morris, and scheduled a confirmation hearing on the reorganization plan for Feb. 17.
The company’s new prepackaged bankruptcy plan will allow Morris Publishing to exchange $100 million in new debt for $278.5 million in existing debt.
With its restructuring plan,Morris Publishing will reduce its overall indebtedness from approximately $415 million to $126.5 million.
That’s a pretty sweet deal. If anything, locals might be a little jealous that they wouldn’t be offered a similar deal if they were facing a fraction of that debt.
What Billy Morris and Simon should be more worried about is what the national media is saying about the company.
The Editor & Publisher blog “Fitz & Jen” was brutal after Morris Publishing’s first day in bankruptcy court with a posting asking thequestion: “Should Newspaper Quality Be Morris Bankruptcy Issue?”
“While holders of 93 percent of the $278 million in bond debt may be, if not happy, then at least content to take a serious haircut by swapping those notes for $100 million in new high-interest notes, two St. Augustine, Fla., residents want to slow down the proceedings,” the blog posted on Jan. 19. “Ed Slavin and Judith Seraphin, CIO and CEO respectively for Global Wrap, a company that shrink wraps buildings for construction and environment containment, filed a motion late Tuesday to be allowed as interveners in the case.”
“In a two-page motion they argue essentially that the news coverage offered by the St. Augustine Record has declined in quality and quantity under Morris’ ownershipto the point it fails in its civic watchdog function, endangering democracy,” the blog states.
According to the blog, Slavin said, “Rather than being a prearranged bankruptcy package, we think every journalism professor, anyone who is an expert on the newspaper industry should be able to come to court take a look at this plan and say, ‘This doesn’t work.’ We want to see the Record become a newspaper again, and we want to see the court hear about it from us.”
Now that is a critical story about Morris’ bankruptcy.
Of course, ironically, Editor & Publisher has had its own share of economic problems.
In December, Editor & Publisher’s parent company, The Neilsen Co., announced it was going to shut down the 125-year-old publication at the end of 2009.
It wasn’t until last month that a California buyer, DuncanMcIntosh Co Inc., announced that it was going to resume publication of the magazine.
So, what’s the point?
Morris is far from alone. So, sorry Billy if the local media hurt your feelings.
Everything is going to be all right.
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