Bankruptcy leads to ownership change

MediaNews CEO Dean Singleton announced today that the company has entered into a debt restructuring agreement as part of Chapter 11 proceedings.

Affiliated Media Inc., the holding company for MediaNews, will have their debt load reduced from $930 million to $165 million. According to the Wall Street Journal, the company's value has been estimated at $200 million.

As part of the agreement, majority ownership of the company has been given to Bank of America and other debtholders. Singleton and MediaNews President Joseph Lodovic now control 20 percent of the company stock. The pair maintain control of all class A shares however, enabling Singleton and Lodovic to elect a majority of the board of directors.

No restructuring of individual properties or newsrooms are planned, according to Singleton, who characterized the move as a blessing for the cash-strapped empire, and perhaps an opportunity to expand further.

“Current shareholders will be losing the value of their holdings. But we believe that adopting this plan will give us a far better platform from which to develop, grow and participate in the consolidation and re-invention of the newspaper industry.”