By: Mark Fitzgerald
The ranks of newspaper publishers still in bankruptcy shrank again this weekend as Freedom Communications announced it had officially emerged from Chapter 11.
Freedom spent eight months in a so-called “pre-packaged” bankruptcy while it completed a restructuring plan that had been approved in advance by the private equity funds who had been brought in by fourth-generation members of the founding Hoiles family to keep a modicum of family control of the owner of The Orange County Register, 31 other dailies and eight TV stations.
An original restructuring plan submitted when Freedom entered bankruptcy in September 2009 gave Hoiles family members a 2% stake with the chance to amass a little more. That was changed in January to leave nothing for the Hoiles and increase the payout to unsecured creditors.
Under both plans, the private equity firms gained control of Freedom — after taking a considerable haircut.
Freedom went into bankruptcy with $770 million in debt, and is emerging with about $320 million, according to a company announcement.
“With a deleveraged balance sheet and liquidity, this company is perfectly positioned to pursue strategic initiatives that will overcome the challenges of today’s media environment and allow Freedom to serve its communities with even greater innovation and intensity,” Chairman James Dunning Jr. said in a statement. “I want especially to recognize Burl Osborne for his leadership, which was incredibly important in guiding Freedom through the challenging restructuring process.”
Osborne will continue as interim president and CEO while the board of directors completes its search for a CEO, Freedom said. It added Osborne will continue as a senior advisor and will remain on the board.
Freedom also added the title of COO to Mark McEachen, the CFO and senior vice president who served as its chief restructuring officer. McEachen will continue to serve as CFO, Freedom said.