Saturday, September 27, 2008

Wall Street Journal: McClatchy was just days away from a default notice

Business writer Dale Kasler from the Sacramento Bee gave a glimpse into a furious response from McClatchy over a headline in the WSJ that McClatchy found objectionable. Kasler wrote this late Friday:
The Wall Street Journal flashed a headline on its Web site this afternoon saying the agreement will keep McClatchy "from defaulting on its debt." But McClatchy Treasurer Elaine Lintecum said the headline was wrong. "We were not defaulting," she said. The Journal took down the headline after McClatchy complained.

Really now. But when you read the actual WSJ article you see the headline isn't the issue -- it's the facts inside the article. Get this:
McClatchy Co. won concessions from banks that spared the newspaper company from a threat of default on its debt.

The publisher of the Sacramento Bee and Miami Herald said Friday its banks agreed to loosen restrictions on the company's level of debt compared to cash flow, and its ratio of interest payments to cash flow.

Analysts had said McClatchy needed to secure the changes by Sept. 30, or the company risked a technical default on its debt. A default notice could trigger a bankruptcy-court filing.

Days from default and a potential bankruptcy filing?! I haven't seen anything indicating things were that serious.

Dale's piece made it sound like the WSJ changed the headline and conceded McClatchy wasn't on the verge of default. But, when you read the actual article you realize the WSJ is literally claiming McClatchy was on the verge; a default notice could have come by September 30. But most Bee readers won't read the WSJ article because Dale didn't link to it. Hide the bad news and Bee subscribers won't notice.

McClatchy renegotiates credit agreement with lenders


Anonymous said...

McClatchy has it's own built in "damage control" within it's own network but they can't control what is published outside their network.
WAAAAAAAAAAAAAAAAAAAHHH...they are snitching on me!!!

McClatchy Watch said...

I think it's strange McClatchy is bragging about getting the WSJ to change a headline...

I wonder if a McClatchy paper has ever changed a headline when somebody complained.

Anonymous said...

The WSJ is a class act more than I can say about McClatchy. I don't see the WSJ running to the bank and maybe McClatchy should check the difference in the stock price. One winner and one loser.

nick said...

mcclatchy ceo kill his company by buy knight ridder inc for 4 billion