As
Western Communications prepares to shrink while liquidating assets through
bankruptcy including real estate and small newspapers in Oregon and California the
future is uncertain for the company’s 117-year-old flagship Bend Bulletin and
its 87,000 square foot headquarters facility.
The
Bulletin reported in its June 22 edition that the company has received an offer
of $1.15 million for the Sonora (CA) Union Democrat weekly and office building
and $240,000 for a Redmond building that formerly housed the Redmond Spokesman.
The
combined offers totaling $1.39 million follow earlier reported offers of
$775,00 for The Observer in LaGrande and the Baker City Herald, and $350,000
for the Curry Coastal Pilot in Brookings and the Del Norte Triplicate in
Cresent City, CA.
Any
offers must be approved through the company’s Chapter 11 federal bankruptcy
proceedings. A hearing is scheduled for June 27 for the earlier offers and July
29 for the more recent ones. Other potential buyers for the Union Democrat can
submit competing offers by July 11 but must exceed the original offer by
$50,000.
All
the offers to date total $2,515,000, a small step in reducing the approximately
$30 million debt carried by the company, much of that to its largest secured
creditor, Sandton Master Fund Credit Solutions III LP, a fund of New York based
Sandton Capital.
The
largest single debt is a note with a face value of nearly $19 million on the
Bend headquarters facility, built in the early 2000s. Sandton acquired the debt from Bank of America after Western emerged from an earlier Chapter
11 bankruptcy filing in 2012.
Investor groups such as Sandton typically pick up troubled debt at deep discounts but the price it paid BofA is not recorded in county records
Investor groups such as Sandton typically pick up troubled debt at deep discounts but the price it paid BofA is not recorded in county records
As
the largest secured creditor, Sandton would have first position claims on any
funds generated by Western’s asset sales, including real estate, printing
equipment and newspaper operations.
The
prospective buyer of the Union Democrat is Rhode Island Suburban Newspapers,
RISN, which the broker representing Western said in an August 2018 news release
owns media properties throughout Canada and the United States.
Other
online sources show that in 2007 RISN purchased the Rhode Island newspapers then
owned by the Journal Register Corp, which also owned the New Haven (CT) Register
before acquisition by another company.
EO
Media has offered to buy the LaGrande and Baker City papers, while Country
Media wants to purchase the Del Norte Triplicate and Curry Coastal Pilot. EO
Media owns the East Oregonian in Pendleton and the Hermiston Herald, as well at
the Capital Press in Salem, and currently prints the LaGrande and Baker City papers
for Western. Country Media has small weeklies on the Oregon Coast, in Montana
and North Dakota.
In
its bankruptcy filing Western has said it anticipates selling newspaper
operations in a wide price range from $5 to $10 million. The company has listed
the headquaraters property for sale at $18 million and has also offered to
lease approximately 5,000 to 20,000 square feet of the building.
The
building is well-located along SW Chandler Avenue, named for the late,
respected Robert Chandler whose daughter is currently Western’s chairman and
pubisher. Some speculation has arisen whether the building would be appropriate
for expansion of the new nearby OSU-Cascades campus along the street to the north.
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