The Journal Register Company, the parent company of the New Haven Register, announced Wednesday that it is filing for bankruptcy.
The company announced in a morning email to its employees that it had filed voluntary petitions for Chapter 11 bankruptcy in a New York federal court. The newspaper chain said it intends to initiate a bankruptcy sale in which investors will bid to take ownership of the company’s holdings. According to New Haven Register Publisher Tom Wiley, the filing enables Journal Register Company to shed debts and to continue normal operation throughout the sale process.
“After much consideration, the Board of Directors concluded a Chapter 11 filing was the best course of action for Journal Register Company,” John Paton, CEO of Journal Register Company, said in a Wednesday press release. “As difficult as they are, the steps we announced today are steps that will ensure the company’s future.”
Alden Global Capital, the hedge fund that acquired the Journal Register Company last year, may be the most likely buyer in its upcoming sale, said Joshua Benton ’97, director of the Harvard Nieman Journalism Lab — essentially meaning that the hedge fund will sell the company back to itself. This way, he added, the newspaper is using bankruptcy to rid itself of many of its pension and lease debts without a management turnover.
“They may be in a position where they can go through this bankruptcy and come out pretty much the same company — only a bit leaner,” Benton said.
Currently, the Journal Register Company employs 110 journalists across Connecticut who write jointly for the New Haven Register, The Shoreline Times, The Middletown Press, The Torrington Register Citizen and Connecticut Magazine. Wiley said that at the moment, no layoffs are planned across the state-wide newsroom as a part of the bankruptcy sale, though he added that he could not make any promises about the future.
Paton said in the release that the company’s digital revenues increased by 235 percent from 2009-’11. On average, Journal Register websites receive 3.8 million unique visitors a day, according to Jon Cooper, the vice president of Digital First Media, which operates the Journal Register. Paton said in the press release that his company plans to streamline its publications and make them more reliant on online visitors despite the fact that print remains far more profitable.
Paul Bass ’82, editor of the local news website New Haven Independent, said that Journal Register Company is “making a valiant attempt” to preserve the for-profit model of journalism, but he does not expect it to succeed. Bass, whose website is funded entirely by grants and charitable donations, added that the Internet has decimated the for-profit journalism industry because news websites no longer maintain a monopoly on local advertising.
“Even though we compete for stories, I’m rooting for them to succeed because the more models out there, the better,” Bass said. “But I think today’s bankruptcy is the latest reminder of how hard it is to preserve some vestige of the old model.”
Benton told the News that though the Journal Register Company was the first to initiate a new round of bankruptcy filings in the newspaper industry, he expects several more newspaper chains to follow suit in the upcoming year.
The Journal Register Company plans to emerge from bankruptcy in about 90 days, according to the press release.