FTI Consulting is handling McClatchy's Chapter 11 filing as the owner of 30 newspapers seeks to restructure debt, shed pension obligations and accelerate its digital transformation.
In a letter to stakeholders, CEO Craig Forman noted the media industry has been under tremendous pressure from disruptive forces such as technological advances consumer-behavior shifts, and business-model challenges.
“We believe the actions we have taken are an important step to ensure a strong future for McClatchy, and we look forward to emerging from this process in the next few months with a stronger financial foundation,” he wrote.
McClatchy asked the Pension Benefit Guaranty Corp. in November to assume control of its pension fund assets and obligations because it will not be able to make the required $124M contribution in 2020. It uses BGR Government Affairs to build support in Washington for the bailout of the underfunded pension fund.
The 163-year-old company, which posted a $287M operating loss on $526M in nine-month 2019 revenues, owns the Charlotte Observer, Sacramento Bee, Kansas City Star and Miami Herald. Its stock trades at 75 cents. The 52-week range is 29 cents, $6.23.
FTI's Rachel Chesley, Lou Colasuonno and Ryan Toohey work the restructuring.