Sunday, January 18, 2009

Minneapolis Star-Tribune files for bankruptcy

The bad news in the newspaper business continued to mount on Thursday as The Star Tribune of Minneapolis filed for bankruptcy protection.

Star Tribune management warned last month that it would seek bankruptcy protection if it did not win a series of labor concessions on wages and other matters by Friday. Talks with the major unions broke down last week and had not resumed.

The newspaper announced the filing on its Web site Thursday evening.

The publisher, Chris Harte, said in a statement, “We intend to use the Chapter 11 process to make this great Twin Cities institution stronger, leaner and more efficient so that it is better positioned for the future.”

Papers nationwide have suffered from a sharp decline in advertising in the last two years, along with a slower, long-term slide in circulation.

The Star Tribune has the additional problem of a heavy debt burden it took on two years ago, when a private equity group, Avista Capital Partners, bought the paper for $530 million.

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