As the Creative Loafing bankruptcy case winds its way through the courts, Michael Miner reports that the Reader laid off more staffers last week. "Six more layoffs last Thursday reduced this paper's editorial staff to 17," Miner writes. "It was 38 when the old owners sold [Ben] Eason the paper." Creative Loafing (Tampa) also announced a handful of layoffs last week. MORE ON CL: Former Creative Loafing (Atlanta) editor Cliff Bostock offers his take on the problems at the Loaf.
The bankruptcy court judge refused to grant a motion by lender Atalaya to give it ownership of the company yesterday, Creative Loafing (Tampa) reports. Judge Caryl E. Delano ruled that CL's reorganization plan should proceed, and that it was too early into the case to say the plan won't work. On a second part of Atalaya's takeover motion, the judge scheduled the final evidentiary hearing for Jan. 21, and a Jan. 26 hearing has been set to review CL's proposed reorganization plan.
Creative Loafing (Tampa) political editor Wayne Garcia says the plan, filed Monday in the company's Chapter 11 bankruptcy proceedings, makes the case for keeping the company in the hands of CEO Ben Eason. "The Debtor believes retention of existing senior management and existing publishers, editors, directors of shared services and key online personnel are vital to successful implementation of this strategy as the markets are shifting very quickly at this time," the plan reads. CL also filed a 10-year financial forecast and an analysis of how much the company would bring if it were liquidated. Read more from Atlanta Magazine's Steve Fennessy.
That's what sources tell Atlanta Magazine's Steve Fennessy about the first court date of the company's bankruptcy protection hearings. Next week, CL CEO Ben Eason has to submit his restructuring plan, which will then be discussed in court. In other CL-related news, The Sunday Paper's publisher and investor answer some questions about that paper's proposed expansion into two more CL cities (Charlotte and Tampa).
"What does this mean for the Advocates? Who the fuck knows? We're so low in the Tribune food chain that we're not even mentioned in the annual reports," writes Christopher Arnott, who spent 17 years as an Advocate staffer before going full-time freelance. "The Advocate's sucked it up before and [stayed] alive in hard times. Let's hope the corporation gives it the chance to do it again."
The embattled Tribune Company, which owns three AAN papers, has hired an investment bank and law firm in recent days to advise the company on a possible trip through Chapter 11 bankruptcy, according to the Wall Street Journal. Tribune owns the Fairfield County Weekly, Hartford Advocate and New Haven Advocate. Sources tell the Journal that a filing could come as early as this week. UPDATE (4:05 pm): The company did indeed file for bankruptcy protection today, and will stop making interest payments on $12 billion in debt as it attempts to restructure its loans, the Los Angeles Times reports.
The Sunday Paper publisher Patrick Best announced his plans on Friday, citing the troubles of Creative Loafing -- which owns papers in Atlanta, Charlotte and Tampa -- as a major reason. "While we planned to go to both of these markets in the next few years, the troubles of the parent company of the major newsweeklies in both cities have convinced us to accelerate our plans," he says. Best, who was Creative Loafing (Atlanta)'s advertising director before launching The Sunday Paper, recently offered CL CEO Ben Eason $1 million for the Loaf's Atlanta publication. Best's expansion plans are being helped by funding from Brian Conley, the former owner of Knoxville, Tenn., AAN member Metro Pulse and current shareholder of Sunday Paper Publishing. Meanwhile, Atlanta Magazine's Steve Fennessy reports that Eason's main creditor filed a motion (PDF) on Friday claiming CL has not been forthcoming in explaining budgets and cash flow forecasts. The CL bankruptcy protection case is scheduled to go before a judge on Wednesday.
In a farewell message to former Creative Loafing (Atlanta) editor Ken Edelstein, staffer Mara Shalhoup writes: "I think I speak for everyone here when I say, 'Thank you for giving me a chance. Thank you for working me hard. And thank you for making Creative Loafing aim higher. You will be missed.'" Edelstein, who had been with the paper for a decade, was fired last week after a reportedly "heated meeting" with CEO Ben Eason on implementing editorial cuts.
Patrick Best, who spent four years as CL's advertising director before starting rival publication The Sunday Paper, told Atlanta Magazine's Steve Fennessy last week he's willing to pay Ben Eason $1 million for Creative Loafing (Atlanta). Fennessy notes that it is unclear whether the purchase would even be possible, given CL's Chapter 11 status, but Best says "it's not unusual for businesses that are in bankruptcy to sell off pieces of their company in order to raise capital." MORE on Creative Loafing: Former senior editor (and current shareholder) John Sugg writes about CL's "death spiral," and Creative Loafing's Mara Shalhoup responds. And departing senior writer Andisheh Nouraee discusses why he is leaving with Atlanta Progressive News.
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