The Portland Press Herald has a progress report on the sale of the three dailies that comprise Blethen Maine Newspapers, a subsidiary of the Seattle Times Co., and it doesn't look like the deal is anywhere near being consummated.
A group of business people, Maine Media Investment, has found a "lead investor," but a principal says the group is still working on getting a bank loan. And it's not clear that this lead investor, HM Capital Partners in Dallas, has money readily available to complete the acquisition.
The privately held Seattle Times Co., controlled by the Seattle-area Blethen family, owns the Portland Press Herald and Maine Sunday Telegram, the Kennebec Journal in Augusta, the Morning Sentinel in Waterville, a weekly, and a Web portal. The Press Herald interviewed Richard Connor, the lead figure in Maine Media, who said HM Capital Partners will seek to assemble a financial package that
... could include capital from a variety of sources, including individual investors, banks or other institutions, or the firm's own fund. HM Capital Partners is currently managing a fund of $1.6 billion, according to the firm's Web site.
Sounds pretty vague. Meanwhile, the original partners who came forward with Connor to buy Blethen Maine Newspapers — including former U.S. Sen. and former Defense Secretary William Cohen — might not have an actual financial stake in the company.
Connor said Friday that his three Maine partners will continue to play a role in the acquisition and might contribute equity to the purchase, even though the lead investor is from Texas.
Um, "might contribute equity to the purchase"? You mean after all the ballyhoo about local people buying the Maine newspapers, they might not actually have a stake in them? They'll be owned by Texans?
Connor said he remains optimistic that Maine Media will be able to complete the deal, even though credit markets are tight and the partnership has missed what have proven to be two informal deadlines for consummating the purchase.
Connor and Blethen Maine Newspapers initially set a goal of closing on the sale by the end of 2008. That goal was extended by about 30 days – to roughly the end of January – when Maine Media was unable to line up financing.
Connor said Friday that he now hopes to finish the acquisition within another 30 days.
"It's a little less stressful today than it was three weeks ago, because I have somebody that I've worked with before, and we have a reputation together," Connor said, referring to [HM partner Peter] Brodsky.
The Seattle Times Co. also owns The Seattle Times, the Yakima Herald-Republic, the Walla Walla Union-Bulletin, two Washington weeklies, NWsource.com, real estate, and Rotary Offset Press in Kent, Wash.
The company still owes some $90 million on the loan it got to buy the Maine papers in the first place 10 years ago and needs to unload them because it can't service the debt. The Seattle Times Co. also has for months been trying to sell real estate in Seattle's South Lake Union neighborhood.
There's a lot of speculation that the company could file for bankruptcy this spring, a noteworthy potential development that coincides with the apparently likely closure of the printed Seattle Post-Intelligencer. But most of the speculation about bankruptcy seems based on the fact Times Co. officials won't deny it's a possibility.
The Portland Press Herald report has a lot of upbeat comments from Connor and Blethen Maine Newspapers officials, including Seattle Times Co. CEO Frank Blethen. But the facts suggest a still-precarious deal.