Sun-Times Media Group Inc., parent company of the Chicago Sun-Times and dozens of other suburban newspapers, filed for bankruptcy protection in a Delaware court, the Associated Press reports.
The AP report states:
“The filing was widely seen as a step toward shutting down a feisty paper known for uncovering city scandals that once went as far as to secretly operate a bar to expose crooked city inspectors.”
But Sun-Times chairman and CEO Jeremy Halbreich told readers:
“Please be assured that this action does NOT mean the company or our newspapers or online sites are going out of business.”
The company has financial problems that go beyond the current tough times in the newspaper business. The defense of Conrad Black and various other expenses related to his era at the company are considered part of the reason the company is struggling.
Sun-Times spokesperson Tammy Chase said:
“The litigation costs of defending Mr. Black and other members of his management team was a huge financial drain on this company and we recouped virtually none of that.”
The firm also paid $34 million to Canwest in mid-March to settle a legal dispute that goes back 2000, when Sun-Times (then Hollinger) sold Canwest a group of newspapers.
And the Internal Revenue Service say it is owed up to $608 million in back taxes from the Black days.
Read Paul Waldie’s report in The Globe and Mail for further details about Sun-Times’ financial situation.