It’s interesting how two separate news articles, published on the same day in papers a continent apart, used the same Orwellian description of the new debt agreement between McClatchy Newspapers and its lender. The Sacramento Bee, McClatchy’s flagship California paper, reported that the company’s negotiations with its lender had helped it “win greater financial flexibility.” The Raleigh News & Observer’s story about the same event for its North Carolina audience announced that the negotiations had resulted in McClatchy “winning concessions” from its lenders. So what exactly did the victorious negotiators from McClatchy win? Well, the company now has to (a) pay more interest on its loan, (b) cut its dividend, and possibly eliminate it altogether, (c) accept a reduction in its credit line, and (d) pledge all of the company’s assets to secure the loan. In return, McClatchy essentially got nothing more from its lender than a little time while the company looks for ways to keep afloat. If that’s winning, I’d hate to see what losing looks like.
Wall Street Journal: McClatchy was just days away from a default notice