The group of business people who paid $562 million to return The Philadelphia Inquirer and Philadelphia Daily News to local ownership in 2006, only to file for bankruptcy protection earlier this year, have now filed for Chapter 11 protection themselves.
Philadelphia Media Holdings LLC (PMH) filed for bankruptcy protection in U.S. Bankruptcy Court in Philadelphia, claiming assets of between $100,001 and $500,000, and liabilities estimated between zero and $50,000.
A PMH spokesman said PMH is a holding company with no employees or revenue. "What it holds is the actual legal entity Philadelphia Newspapers LLC and other smaller properties that are also incorporated separately," spokesman Jay Devine said.
Last Feb. 21, Philadelphia Newspapers, the publishing company of the two dailies, filed for Chapter in Philadelphia, to restructure its debt load of $390 million in debt load.
When Philadelphia Newspapers filed for bankruptcy last February, it wasn't thought necessary to include PMH in the filing, headded. But PMH is also named in some litigation along with Philadelphia Newspapers. Since the litigation is stayed during bankruptcy proceedings, filing for Chapter 11 ensures that PMH cannot be pursued in court separately.
PMH is the group formed by local public relations executive Brian P. Tierney to buy the newspapers from The McClatchy Co.,which acquired them in its acquisition of Knight Ridder Inc. The group put up $152 million in cash and borrowed the rest of the $562 million purchase price.
According to the bankruptcy petition, filed last Wednesday, the largest stakeholders in PMH are the Carpenters Pension and Annuity Fund of Philadelphia with a 30.35% interest, followed by luxury housing magnate Bruce E. Toll with a 20.26% stake. William A. Graham IV is listed as having a 16.88% stake. Tierney's interest in PMH totals 6.75%.
