Bend-based publisher Western Communications has filed for Chapter 11 bankruptcy protection.
The company owns the Bend Bulletin as well as four other papers in Oregon and two more in California. As David Nogueras reports, lawyers want a bankruptcy judge to renegotiate an $18 million loan from Bank of America.
Publisher and President Gordon Black says the company originally borrowed the money for a series of capital improvements and an acquisition.
But when the markets tanked, so did company profits. That was a problem because of a provision in the loan requiring the company to maintain certain profit ratios. Black says B of A demanded repayment and dramatically increased the company’s interest rate.
Black said, “Based on what they told us, the bank in general decided that they didn’t like media companies any more and they particularly didn’t like newspapers.”
Bank of America spokeswoman, Shirley Norton, says she can’t comment on customer relations due to confidentiality. Black hopes the company will be able to emerge from Chapter 11 within 6 months.