NEW YORK (AP) - Media conglomerate Tribune has become the first
major newspaper publisher to seek bankruptcy protection since the
Internet began siphoning readers from traditional outlets.
Tribune -- which owns the Los Angeles Times, Chicago Tribune and
other properties -- made today's filing in bankruptcy court in Delaware.
Tribune's next major principal payment on the debt, of $593 million, isn't due until June.
But Tribune has been in danger of missing lender-imposed financial targets at year's end.
Those targets are based on the level of Tribune's debt relative to its cash flow, and become harder to meet as revenue declines, even if the debt itself doesn't increase.
Tribune is smothered by $13 billion in debt and weak prospects for generating cash through advertising.
Other newspaper companies have also struggled with their debts. But many have successfully negotiated with lenders to ease their targets in exchange for higher interest rates.
(Copyright 2008 by The Associated Press. All Rights Reserved.)