Morris Publishing Group announces call for redemption of its public debt

Thursday, July 12, 2012 1:57 PM
Last updated 10:34 PM
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The Augusta Chronicle’s parent company has called for the redemption of all public debt, about two years ahead of the due date.

Morris Publishing Group LLC announced Thursday that it has elected to redeem all outstanding notes and has deposited the funds with the trustee to pay off the notes Aug. 10.

The company refinanced its debt with CB&T of Columbus, Ga., a division of Synovus Bank.

Morris Publishing, based in Augusta, filed a prepackaged plan of reorganization in U.S. Bankruptcy Court in January 2010 to restructure its debt. It emerged from Chapter 11 bankruptcy two months later.

“Today demonstrates just how far we’ve come in proving that there is a sustainable future for our company,” William S. Morris IV, the chief executive officer of Morris Publishing Group, said in a press release. “We believe in the power of journalism and commercial and non-commercial information provided to serve local communities daily. We continue to change our operations to reach local audiences and serve local businesses across print and digital channels.”

Morris emerged from bankruptcy in 2010 with new second lien secured notes, which were due in 2014, according to the press release. Since then, Morris has worked to pay down the debt and refinance, the release said. The company had $100 million in debt after the bankruptcy. According to a Thursday filing with the Securities Exchange Commission, the principal amount of the new notes is $57.2 million.

The company has restructured its management and workforce in the past three years, emphasizing its digital platforms and customer solutions, the statement said.

“The call for early redemption and payment to our bond holders is a huge milestone for us and reflects the commitment that our company leaders and employees have had to turn around a financially stressed organization,” said Derek May, the executive vice president of Morris Publishing. “Our future is bright as we transform into a digital-first media company, and this transition in financing shows the confidence we and our lenders have in our future.”

May said he is proud of the company’s progress in the years since emerging from bankruptcy.

“We still have the challenges of our industry,” he said. “We have a lot of opportunities in digital.”

In addition to The Chronicle, Morris Publishing operates 11 other daily newspapers, in addition to nondaily newspapers, city magazines and free community publications.

Under the new agreement, Morris Publishing Group LLC continues to be wholly owned and controlled by the Morris family.

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bdouglas 07/12/12 - 02:27 pm
Maybe I don't understand

Maybe I don't understand exactly what's going on here, but how does what seems to be simply refinancing at a better interest rate equate to “Today demonstrates just how far we come in proving that there is a sustainable future for our company”? That just means you have a lower monthly payment, essentially. If you weren't doing so well to start with, a lower payment would seem like a smart thing to obtain if you can. Again, maybe I don't follow exactly what this means in the financial world, but that's what I take away from it.

Shellman 07/12/12 - 02:58 pm
What Billy Wants

...Billy gets

Carleton Duvall
Carleton Duvall 07/12/12 - 04:13 pm
My take on it

It seems that Morris has presented a plan to the bank that convinced them to loan the funds necessary to pay off all outstanding debt. That is good in itself. The bank obviously has confidence in that plan.

Riverman1 07/12/12 - 04:56 pm
Riverman is Responsible

I think Riverman is greatly responsible for helping the company improve its debt picture.

IsAnyoneAlwaysRight 07/13/12 - 07:16 am

For all!

Fiat_Lux 07/13/12 - 09:37 am
This is a good thing

The people Billy Morris has running his enterprise clearly have had a grip on what needed to be done. They managed to reduce the debt principal by almost 45% in just two years, and have an operational plan that appears to be working well in their market areas.

Why wouldn't banks invest in a company generating that kind of growth, especially in a virtually stagnant economy? I sure would.

Craig Spinks
Craig Spinks 07/13/12 - 09:37 am
Fiat_Lux 07/13/12 - 10:45 am
Excellent point, Craig

Admittedly from Wikipedia, but still...

"In mid-August 2009 the bank was named as one of the biggest of more than 150 U.S. lenders which own nonperforming loans that equal 5 percent or more of their holdings. Five percent is a threshold that former regulators have stated can wipe out a bank’s equity and threaten its survival.[1]

As a result of their financial troubles, Synovus laid off 850 employees and closed multiple bank branches in early 2011.[2] In January, 2012, Synovus still owed the US government Troubled Asset Relief Program $967.9 million.[2]"

(The references are just financial news reports from Bloomberg News and the AJC.)

It still has dozens of offices open around the Southeast and hasn't been taken over by the FDIC, so it must be doing at least reasonably well.

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